European stocks rise supported by mining sector and investors keep an eye on the Middle East

European stocks rose on Monday, led by gains made by mining companies amid optimism about demand from China, the largest consumer. However, trading witnessed a cautious approach as investors evaluated the possibilities of escalating conflict in the Middle East.

The European STOXX 600 index rose 0.4 percent by 0707 GMT.

The mining sector index rose 1.3 percent with an increase in basic metal prices supported by hopes for stronger demand from China after data last week showed some signs of stability in the world’s second largest economy.

The index was also boosted by gains of nearly four percent for shares of the Swedish steel maker SSA.

Global risk appetite remains weak due to fears that the conflict between Israel and the Palestinian Islamic Resistance Movement (Hamas) will spread to the broader region and intensify after Iran warned Israel against escalation.

Among other individual stocks, BioNTech’s shares, listed on the Frankfurt Stock Exchange, fell nearly five percent after its partner Pfizer on Friday lowered expectations for full-year revenue due to a decline in sales of the Covid-19 vaccine and treatment.