European Shares Decline Amid Israel-Iran Tensions

(RTTNews) - European shares drifted lower on Friday as heightened Middle East tensions offset encouraging inflation data from Germany and France.

Israel launched strikes against Iran, targeting nuclear facilities and ballistic missile factories as part of efforts "to damage Iran's nuclear infrastructure, its ballistic missile factories and military capabilities."

The overnight strikes on the country killed at least three of its senior military leaders. Iran retaliated by launching more than 100 drones toward Israeli territory.

In economic news, Germany's consumer prices logged a steady annual growth in May due to the continued decrease in energy prices, final data from Destatis showed today.

The consumer price index climbed 2.1 percent from a year ago, the same rate of growth as posted in April. The rate matched the flash estimate released on May 30.

Inflation based on the harmonized index of consumer prices softened to 2.1 percent from 2.2 percent in the previous month.

Elsewhere, France's consumer price inflation moderated slightly as initially estimated in May to the lowest level in more than four years amid a slowdown in costs for services and a continued fall in energy prices, the latest data from the statistical office INSEE showed.

The consumer price index rose 0.7 percent on a yearly basis in May, slower than the 0.8 percent stable increase seen in April. That was in line with the flash data published on May 27.

This was the lowest inflation rate since February 2021, when prices had risen 0.6 percent.

The pan European STOXX 600 dropped 0.7 percent to 546.09 after declining 0.3 percent on Thursday.

The German DAX fell 1.2 percent, France's CAC 40 gave up 0.8 percent and the U.K.'s FTSE 100 declined half a percent.

Travel-related stocks slumped, with Lufthansa, easyJet, Wizz Air Holdings and British Airways owner ICAG EasyJet falling 3-5 percent.

Oil & gas giant BP Plc rallied 3 percent and Shell added 1.7 percent as crude prices jumped more than 4 dollars a barrel on supply concerns.

Technology group Ocado tumbled 3 percent after announcing that it has drawn down on a Letter of Credit under its deal with Kroger Co. (KR), for $152 million, issued by the Bank of Nova Scotia.

Oxford Instruments lost 4 percent despite reporting strong results for the fiscal year ended March.