European Indices Enter Correction Territory as Geopolitical Tensions and Energy Prices Surge

Major European indices, including the UK's FTSE 250 and France's CAC 40, have officially entered correction territory following a 10% decline from their yearly peaks. The market slump is primarily driven by the escalation of conflict in the Middle East, notably the Iranian strike on Qatar's largest natural gas plant. This attack has caused substantial damage to energy infrastructure, triggering a sharp spike in European energy costs and market volatility. Since the conflict began in February, UK oil and gas prices have surged by more than 50%, intensifying regional economic pressure. These developments have reignited fears of persistent inflation, potentially complicating the outlook for central bank monetary policies. Market participants remain cautious as the geopolitical instability threatens global supply chains and broader financial stability.