Europe open: Markets in cautious mood as US-Iran ceasefire deadline looms

(Sharecast News) - European share markets opened in cautious mood and oil prices slipped on Tuesday as traders eyed the looming ceasefire deadline between Iran and the US.

The pan-regional Stoxx 600 index was up 0.06% to 621 at 0819 BST. Germany's DAX rose 0.47%, France's CAC 40 fell 0.03% and Italy's MIB gained 0.31%.

It was still unclear as to whether Iran would send officials back to Pakistan for a second round of peace talks after the US on Monday seized an Iranian-flagged cargo vessel it claimed was trying to run its blockade. Meanwhile President Donald Trump continued his threats to resume bombing of Tehran refused to accept a peace deal on his terms.

Oil prices slipped despite the blockade of the Strait of Hormuz, with Brent crude down 0.5% to $95.07 and West Texas Intermediate 0.72% lower at $86.79 a barrel.

"The recent yo-yoing in equity sentiment continues to be driven less by fundamentals and more by swings in oil prices, as investors try to second-guess how Middle East negotiations are progressing," said Hargreaves Lansdown analyst Matt Britzman.

"Fresh talks are pencilled in, but timelines for any lasting agreement remain unclear, leaving investors caught between elevated geopolitical risk and hopes that a workable outcome will ultimately be reached - with markets showing a willingness to price in the latter."

"As earnings season gets underway, that backdrop could translate into a run of solid results paired with cautious outlooks, as executive teams acknowledge the potential impact of higher energy costs without committing too heavily to guidance in an environment where volatility is likely to remain a feature."

In equity news, Royal Unibrew tanked by 18% after the Danish beer, soda and energy drinks maker said it was ending its partnership with PepsiCo in northern Europe.

Reporting by Frank Prenesti for Sharecast.com