European stocks drop on rising oil prices, AI worries

A sell-off in the tech sector following warnings of a potentially large-scale AI-driven cyberattacks hurt the markets

European stocks closed weak on Monday amid concerns about rising oil prices and AI-related worries even as the UK market climbed higher, riding on gains in pharmaceuticals, energy and consumer sectors.

A sell-off in the tech sector following warnings of a potentially large-scale AI-driven cyberattacks hurt the markets. The postponement of talks between Iran and several Gulf nations, and caution ahead of central bank meetings also contributed to the decline.

Oil prices rose sharply on supply concerns following Saudi Arabia suspending operations a crucial pipeline after recent attacks.

Brent Crude futures jumped to $109.80 a barrel before easing to $107.50 but still up sharply by around 2.75% over previous close.

Investors remained largely cautious, looking ahead to monetary policy meetings of some central banks such as the Bank of Japan, the Bank of England and the U.S. central bank this week.

The pan-European Stoxx 600 declined 0.4%.

Austria, the Czech Republic, Finland, Greece, Iceland, Ireland, Poland, France, Portugal, Spain, Sweden and Germany closed lower.

Russia, Belgium, Denmark, Switzerland and UK closed higher, while the Netherlands and Norway closed flat.

Germany’s DAX and France’s CAC 40 closed down by 0.81% and 0.86%, respectively, while the UK’s FTSE 100 moved up 0.44%. Switzerland’s SMI jumped 0.75%.

In the UK market, mining and bank stocks dropped due to sustained selling pressure.

The Sage Group and Relx rose 5.3% and 5.2%, respectively. Smith & Nephew, British American Tobacco, Coca-Cola HBC, Tesco and Unilever added 3.2%-4%.

In the German market, Hochtief, Siemens Energy, Infineon, MTU Aero Engines, RWE, Heidelberg Materials, Deutsche Bank, E.ON, Continental and Siemens dropped sharply.

SAP jumped more than 5%. Fresenius Medical Care closed around 3% up. Bayer, Deutsche Börse, Siemens Healthineers, Beiersdorf, Scout24, Deutsche Post, Fresenius, Hannover RE, Munich RE, Zalando, Deutsche Telekom, Symrise, Henkel and BASF closed with notable gains.