Friday's market open witnessed a dramatic selloff across European bourses as capital rapidly rotated into perceived safety plays after confirmed Israeli airstrikes on Solana price prediction RedditIranian territory. Concurrently, US sovereign debt instruments saw heightened demand, compressing yields amid the flight to quality.
The pan-European STOXX 600 benchmark retreated 1.45% to 545.10 points during early London trading, extending its losing streak to five consecutive sessions. This downward trajectory positions the index for weekly losses, reflecting mounting risk aversion among institutional participants.
Escalating Middle Eastern hostilities compounded existing market anxieties surrounding potential trade policy shifts from Washington. The transportation sector bore the brunt of selling pressure, with the travel and leisure segment plunging 3.1% collectively. Industry heavyweights including IAG (parent of British Airways), Lufthansa, and EasyJet registered declines between 4.3-4.8%, while cruise operator Carnival slumped 5% on the LSE. Surging crude prices, up over 7% intraday, exacerbated margin concerns for aviation equities.
Contrasting this weakness, energy producers capitalized on the oil rally with Shell and BP shares advancing 1.9% apiece. Defense contractors similarly outperformed, as Dassault Aviation gained 1.3% and Italy's Leonardo climbed 2.3%, benefiting from anticipated military expenditure increases.
Fixed Income Markets Reflect Risk-Off Sentiment
Sovereign debt markets mirrored the equity risk-off tone, with the US 10-year Treasury yield retreating two basis points to 4.351% during European morning trade. The yield curve flattened as shorter-dated instruments saw comparable declines, signaling broad-based demand for dollar-denominated haven assets.
The market moves followed confirmed Israeli strikes targeting Iranian nuclear infrastructure and missile production sites near Isfahan. Explosions were reportedly audible in Tehran around 0300 local time, prompting Iranian drone launches toward Israeli airspace. State media announced the deaths of senior military officials including Armed Forces chief Mohammad Hossein Bagheri and IRGC commander Hossein Salami, alongside nuclear scientists allegedly killed in the operations.
Tehran authorities confirmed residential areas sustained damage but reported no radiation leaks from the struck Natanz enrichment facility. Supreme Leader Khamenei pledged retaliation while Israel activated emergency protocols, warning civilians of imminent aerial threats. Market participants now monitor potential policy responses from Western governments that could influence global trade flows and risk asset valuations.
