Middle East Tensions Weigh on European Markets

European shares dipped on Tuesday as crude prices rose and euro zone bond yields surged due to Middle East tensions. The pan-European STOXX 600 index fell by 0.2% to 654.81, while energy shares increased by 0.6% with Brent crude climbing around 0.6% to $91.41 a barrel.

A senior Iranian official stated that Iran will shift to a 'fully offensive' military posture as talks for a lasting U.S.-Iran peace deal have stalled. This decision was made after Washington ruled out extending a temporary ceasefire agreement.

The rise in bond yields has added pressure on equities, with investors concerned about persistent inflation. Germany's 10-year Bund yield reached its highest since 2011, while France's 10-year yield hit a 16-year peak.