European Shares Tread Water Amid Oil Price Surge

European shares were relatively flat on Tuesday as oil prices rose following a stalemate in efforts to end the US-Iran war. The pan-European STOXX 600 index hovered around its record highs reached earlier this month, fluctuating between modest gains and losses. Rising energy prices supported oil and gas stocks, but concerns about inflation and monetary easing kept broader risk appetite in check.

The energy sector led the gains, rising 1.4% as oil prices touched their highest level so far this month. This increase was driven by U.S. President Donald Trump's response to Iran's conditions for a peace deal, which included demands of his own, including compensation for people killed in wars, attacks, and protests.

However, the travel and leisure sector fell 0.9% due to worries over elevated fuel costs. InterContinental Hotels Group edged down 1.8% after its room revenue growth slowed in the second quarter. Technology stocks, on the other hand, rose 0.5%, remaining among Europe's top performers this year, up about 24% year-to-date.

Investors are now awaiting euro zone employment and GDP data, as well as U.S. consumer price figures later this week, for further clues on the path of interest rates. Among early movers, Alcon gained 4% after raising its full-year earnings forecast. Spirax Group slid 10.5% to the bottom of the STOXX 600 after reiterating its full-year forecast.