European Shares Seen Opening On Cautious Note

(RTTNews) - European stocks may drift lower at open on Tuesday as investors monitor the latest developments in the Middle East war and await the release of April's U.S. consumer price index reading later in the day for directional cues.

Reports on U.S. producer prices, retail sales and industrial production due later in the week may also provide fresh insights into the impact of the recent spike in oil prices on inflation and consumer spending.

U.S. President Donald Trump will travel to Beijing this week for summit talks with his counterpart Xi Jinping, with issues related to Iran, tariffs, artificial intelligence, Taiwan and critical minerals agreements on the agenda.

Gold dipped toward $4,700 an ounce as the U.S. dollar index climbed above 98.00 due to rising geopolitical tensions linked to the Iran conflict. Amid stalled U.S.-Iran peace talks, investors priced out Federal Reserve rate cuts this year.

Trump said the fragile ceasefire between Washinton and Tehran was on "massive life support," raising fresh doubts over the chances of a lasting truce.

Saudi Aramco officials have warned that even if the Strait of Hormuz blockade ended immediately, global oil markets may not fully stabilize until 2027.

Brent crude futures traded around $105 a barrel, after rising nearly 3 percent in the previous session amid ongoing Gulf war concerns.

According to a Wall Street Journal report, the United Arab Emirates secretly entered the Middle East war and carried out attacks on Iran last month.

Asian markets were broadly lower as a recent chip-fueled runup in technology shares lost steam.

Overnight, U.S. stocks rose slightly to reach new record highs as gains in major technology shares offset worries about stalled U.S.-Iran peace talks.

Investors looked past rising oil prices after President Trump rejected Iran's counteroffer to end the war as "unacceptable", adding the month-old ceasefire with Iran is "unbelievably weak" and on "massive life support."

Trump called Iran's response to his peace proposal a "piece of garbage" and said he "didn't even finish reading it."

The President also said he intends to suspend federal gasoline tax "for a period of time" amid surging prices driven by the Iran war.

The Dow and the S&P 500 both gained around 0.2 percent while the tech-heavy Nasdaq Composite edged up by 0.1 percent.

European stocks ended mixed on Monday as investors reacted to rising U.S.-Iran tensions and a slew of corporate earnings updates.

The pan-European STOXX 600 gained 0.1 percent. While France's CAC 40 dropped 0.7 percent, the German DAX inched up marginally and the U.K.'s FTSE 100 added 0.4 percent.