European stocks close mixed amid Mideast uncertainty

European stock exchanges closed mixed Tuesday as uncertainty about developments in the Mideast continued to weigh on investor sentiment.

The benchmark Stoxx Europe 600 index fell 0.5% to 618.64 points.

Germany's DAX 40 lost 0.75% to end the session at 24,433.06, and the UK's FTSE 100 was off 1.41% to 10,227.33. Losses in banking shares stood out in London.

France's CAC 40, however, rose 0.05% to close at 8,203.43, and Italy's FTSE MIB 30 gained 0.11% to finish at 50,262.76.

Euro/dollar parity was up 0.12% at 1.1553 as of 1740GMT.

Selling pressure stemming from Israeli and Iranian attacks that threatened regional peace talks eased as expectations strengthened that the war would not spiral out of control.

Brent crude futures fell 4.92% from the previous close to $89.61 per barrel as of 1612GMT amid apparent stronger prospects for a diplomatic solution between the US and Iran. US benchmark West Texas Intermediate traded at $86.

Investors are focused on the European Central Bank's policy rate decision due Thursday. While a rate hike is widely expected, market expectations for ECB rate cuts have been pushed back from March 2027 to mid-2027.

Data released Tuesday showed that industrial production in Germany rose 0.4% month-on-month in April.

Fitch Ratings, meanwhile, lowered its global economic sector outlook for this year to "deteriorating" from "neutral," citing the effects of the US-Israel-Iran war.