European Shares Seen Lower At Open As Yields Surge On Inflation Worries

(RTTNews) - European stocks are seen opening broadly lower on Tuesday, even as London's FTSE 100 may rise at open as oil prices continued to climb amid concerns over the prospects of a diplomatic resolution to reopen the Strait of Hormuz, a key route for global energy supplies.

U.S. stock futures ticked lower amid stalled Iran-U.S. diplomacy and ahead of earnings reports from retailers Walmart, Target and Home Depot due this week.

Traders also await minutes of the Federal Reserve's July policy meeting scheduled for Wednesday for additional clues on the outlook for interest rates.

In geopolitical news, U.S. President Donald Trump said that informal talks are taking place with Iran's Revolutionary Guard, but he is "not in a hurry" to make a deal.

Iran has announced reaching an understanding with Oman over the route for maritime traffic in the Strait of Hormuz.

Global bond yields are on the rise, with Japan's 10-year government bond hitting a three-decade high and Euro zone government bond yields hovering near their highest levels in more than 15 years, on concerns that renewed energy inflation could keep interest rates elevated.

Asian markets were mostly lower, and the U.S. dollar hovered near multi-month lows against most major currencies, while gold slipped below $4,400 an ounce after rising for two straight sessions.

Brent crude futures climbed toward $92 a barrel after settling at their highest level since late July on Monday.

Overnight, U.S. stocks ended lower as rising oil prices and bond yields amid an apparent impasse in Middle East peace talks rekindled inflation and interest-rate worries.

International oil benchmark Brent jumped above $91 a barrel, and the 30-year yield reached its highest level since 2007 as the 60-day ceasefire framework between Washinton and Tehran expired without an extension and President Trump threatened to bomb Oman if it "gets in the way" of his administration's own talks with Iran.

Trump emphasized the effectiveness of the U.S. naval blockade on Iran, declaring the Strait of Hormuz a "U.S. territory" and asserting Washinton DC has total control over the region.

However, data showed shipping traffic in the Strait of Hormuz sank to a new low over the weekend following attacks on oil tankers.

The Dow and the S&P 500 both fell around half a percent while the tech-heavy Nasdaq Composite declined 0.3 percent.

European stocks declined on Monday amid concerns over rising energy prices and government bond yields.

The pan-European STOXX 600 fell 0.2 percent. The German DAX dipped 0.4 percent, France's CAC 40 shed 0.7 percent and the U.K.'s FTSE 100 eased 0.3 percent.