European stock markets closed lower on Monday as investors continued to focus on geopolitical tensions between the United States and Iran as the United States prepares to impose major new sanctions on Tehran.
The pan-european stoxx 600 temporarily fell 0.3 per cent.Carmakers led a 1.2 per cent fall after Daimler’s profit warning, with only a few sectors closing in positive territory.
Germany’s DAX index closed down 71.00 points, or 0.58 percent, at 12,268.92.Britain’s ftse 100 index closed up 8.10 points, or 0.11 percent, at 7415.60.France’s cac-40 index closed down 6.62 points, or 0.12 percent, at 5,521.71.
The United States on Monday threatened new “significant” sanctions against Iran, ratcheting up pressure on the islamic republic as its economy is strained by financial restrictions.The threat came despite diplomatic calls from European leaders for restraint.
Mr Trump said on Monday he would sign an executive order imposing tough new sanctions on Iran in response to the downing of a us drone last week.
“We will continue to increase the pressure on Tehran,” Mr. Trump told reporters in the oval office.“Iran will never get a nuclear weapon.”
The us Treasury secretary timothy mnuchin said the trump administration was targeting three Iranian leaders for sanctions. Mr Trump had been working on sanctions against the Iranian leadership and would target the Iranian foreign minister Zarif later this week.
In Europe, Daimler cut its 2019 earnings forecast on Sunday after raising its provision for diesel-related issues by hundreds of millions of euros, sending car stocks down across the region.The company’s stock was one of the worst performers, down nearly 4%.
German business confidence fell to its lowest level since November 2014, according to data released on Monday by the institute for economic research, adding to fears that the country’s economy contracted in the second quarter.
ClemensFuest, Ifo’s President, told CNBC that monetary policy would not save Germany’s cooling economy.