Investing.com - European stocks opened lower on Tuesday, weighed down by few indications that the U.S. and Iran are nearing a permanent peace deal.
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By 03:04 ET (07:04 GMT), the pan-European Stoxx 600 had fallen by 1.2%, the Dax in Germany had slid by 1.4%, the FTSE 100 in the U.K. had shed 1.1%, and the CAC 40 in France was down by 1.1%.
Dampening sentiment were comments from U.S. President Donald Trump, who told reporters on Monday that a fragile ceasefire between Washington and Tehran was on "massive life support."
Earlier, Trump rebuffed Iran's response to an American proposal to end the fighting, describing it is as "unacceptable" and later as a "piece of garbage."
Tehran, for its part, said that its counteroffer was "generous and responsible," with most of the focus on reopening the Strait of Hormuz. The narrow conduit off of Iran's southern coast has been effectively shuttered for weeks, crimping global oil supply flows and fueling fears of a global energy crisis.
"The Middle East returned to the headlines over the weekend, and any normalization of Hormuz shipping now looks delayed," said Felix Vezina-Poirier, Chief Strategist at BCA Research, in a note.
Oil prices resumed their march higher. Brent crude futures, the global benchmark, was last higher by 2.0% at $106.30 a barrel, well above pre-war levels of around $70 a barrel. This uptick has, in turn, fed worries over a surge in inflation and led to expectations that central banks will react by hiking interest rates.
European government bond yields, which tend to move inversely to prices, increased, exerting added downward pressure on equities on the continent.