(Updates for morning European session)

* Hopes for Strait of Hormuz breakthrough fade

* Oil prices creep closer to $100

* Stocks dip but AI hype provides safety net

By Tom Westbrook and Harry Robertson

SINGAPORE/LONDON, June 3 (Reuters) - European stocks and

U.S. futures fell slightly on Wednesday as oil prices rose for a

third session as fresh hostilities flared in the Gulf after

U.S.-Iran peace talks stalled.

Europe's STOXX 600 index fell 0.4% in early

trading while futures for the U.S. S&P 500 slipped 0.1%.

The AI bull run pushed on unimpeded in Asia, however, where

stock indexes climbed to record highs in Japan and Taiwan.

An Iranian missile attack damaged Kuwait's airport on

Wednesday and the U.S. military hit sites near the Strait of

Hormuz as the shaky ceasefire between the two sides was once

again severely tested.

Iran and the United States said last week they had reached a

tentative deal to halt the war, but they have yet to sign off on

anything.

The conflict could slow global growth to rates rarely seen

outside of crises such as the 2008 financial crash and push

inflation sharply higher if it continues into next year, the

Organisation for Economic Co-operation and Development warned on

Wednesday.

Oil prices crept back towards the $100 mark, with global

benchmark Brent crude up 2% to $98 a barrel.

"Last week ... the trajectory was towards some sort of MOU

(memorandum of understanding) and markets were high on the

belief that that was coming," said Chris Weston, head of

research at broker Pepperstone in Melbourne.

"Things are looking more precarious (now). It does suggest

that people are coming back to the negotiating table with less

scope to get that done and I think we're seeing some of those

bets being unwound."

Stock markets in Europe, which is an energy importer and has

fewer companies focused on AI, have been hit harder by the Iran

crisis than their U.S. peers.

The U.S. dollar index, which tracks the currency

against its peers, was flat at 99.31.

Currency traders were on edge, however, after the dollar

rose against the Japanese yen to the 160 level at

which the market tends to become nervous about intervention from

authorities in Tokyo. The dollar then dipped to trade at 159.65

yen.

The fall in the yen prompted fresh warnings by the finance

minister on Wednesday.

AI HYPE ROLLS ON

In the tech space, the artificial intelligence theme seems

impervious to war worries and Wall Street stock indexes eked out

small gainsto trade at record highs on Tuesday.

Shares in Marvell Technology ( MRVL ) soared 32.5% to a record

high after Nvidia ( NVDA ) boss Jensen Huang called the

chipmaker the next trillion-dollar company.

AI gains have lifted tech investor SoftBank above

Toyota ( TM ) as Japan's most valuable company.

"The market tone is still broadly upbeat, despite oil prices

ticking higher as investors try to make heads or tails of what's

going on in the Middle East," said Matt Britzman, senior equity

analyst at Hargreaves Lansdown.

SpaceX- which is largely focused on AI - plans to raise $75

billion in a blockbuster initial public offering, according to a

source familiar with the matter.

Survey data on the U.S. services sector and private payrolls

figures are due later on Wednesday, ahead of labour market data

on Friday.

Markets, which had expected rate cuts before the Iran war,

have priced in about 18 basis points of U.S. rate increases this

year.

A hike in Europe next week is all but fully priced in following

data showing inflation accelerated further last month, while

traders see about a 75% chance of a June rise in Japan.