A look at the day ahead in European and global markets from Rae

Wee

Oil prices were back on the rise on Tuesday and touched their

highest this month, as Washington and Tehran continued to trade

demands for the reopening of the Strait of Hormuz.

U.S. President Donald Trump responded to Iran's conditions for a

peace deal with his own demands that Iran pay compensation for

people killed in wars, attacks and protests, dimming prospects

for an imminent deal to reopen the key waterway.

Since the war began in February, Trump has swung repeatedly

between threats of escalation and claims that a peace deal is

nearing, leaving investors increasingly weary.

Stocks drifted in Asia, as continued tensions in the Middle East

and prolonged uncertainty over the global inflation outlook

sapped market sentiment, though key will be Wednesday's U.S.

inflation data, which will provide clues on the Federal

Reserve's next rate move.

Overnight, Cleveland Federal Reserve Bank President Beth Hammack

said she feels the time is now to start raising interest rates

gradually, so as to avoid needing to raise rates more sharply

later.

The data calendar for the day ahead is light, so the focus

will be on developments in the Middle East.

On the U.S. earnings front, CoreWeave ( CRWV ) is expected

to report a sharp jump in second-quarter revenue as the company

sees a surge in demand for its AI cloud services amid massive

data centre spending by tech companies, with investors focused

on the outlook and investment plans for the year.

Speaking of AI, Nvidia ( NVDA ) said on Monday it has partnered

with six major financial institutions to launch compute

financing platforms aimed at raising more than $500 billion in

third-party capital for AI infrastructure, underscoring the

scale of the sector's investment boom.

And over in foreign exchange land, the yen was back in

the spotlight as the Japanese currency stood on the weaker side

of 159 against the dollar, giving up some of its intervention

gains.

Key developments that could influence markets on Tuesday:

- Developments in the Middle East

- U.S. earnings including CoreWeave ( CRWV ), Super Micro Computer

- Reopening of 5-year German government debt auction

(Editing by Kate Mayberry)