David McNamara: Eurozone economy suffers more than US in enduring Iran conflict

US markets have benefited from the economy’s relative insulation to geopolitical risks and solid corporate earnings

US president Donald Trump. US markets have benefited from the economy’s relative insulation to geopolitical risks and solid corporate earnings
Picture: AP Photo/Jacquelyn Martin

As further hard data trickles out amid the ongoing Iran conflict, it appears the European economy is suffering most from the impact, outside of the immediate Middle East region. Economic surprise indices point to a sharply diverging trend in the incoming European data versus expectations compared to the US and global metrics. 

This has also been reflected in equity markets, with the benchmark Euro Stoxx 50 down nearly 4% since the start of March, compared to a near 8% gain in US equities. UK markets have fared even worse down around 6% over the same period, with the UK buffeted by structurally higher inflation and political uncertainty.