European Energy Sector Surges Amid Middle East Tensions

European shares inched higher with strong support from energy stocks due to rising oil prices linked to Middle East tensions. The STOXX 600 showed minor gains but faced its worst week in months. Energy was the standout sector, while automobiles slumped, hindered by Stellantis' significant losses. The ECB's upcoming meeting is in focus.

On Friday, European shares saw modest gains, primarily driven by a robust performance in regional energy stocks. This uptick followed escalating crude oil prices, fueled by concerns over deepening conflict in the Middle East.

The pan-European STOXX 600 index edged up by 0.2%. Despite this improvement, the index might close with its worst weekly performance since early September, having dropped nearly 2% earlier this week. Investor caution is evident amid rising tensions in the Middle East.

Leading the charge was the energy sector with a 4.5% surge over the week, marking its strongest performance in nearly half a year. Conversely, the automobile sector struggled, plunging nearly 7%, with Italian-American automaker Stellantis suffering a significant setback after issuing a profit warning.

(With inputs from agencies.)