European Shares Rebound Amid Middle East Tensions and Energy Woes

European shares saw a modest increase on Tuesday, edging higher from multi-month lows as investors processed mixed signals from the ongoing conflict in the Middle East. Energy shock concerns, however, continued to weigh heavily on potential gains.

The pan-European STOXX 600 rose by 0.3% to reach 578.45 points by 0803 GMT, recovering from its lowest level since November 2025 hit in the previous session. This growth was largely supported by energy stocks, which benefited from rising oil prices.

Global equities regained some ground following sharp losses after U.S. President Donald Trump's announcement of a delay on offensive action against Iran. Trump cited positive dialogue underway, a notion Tehran dismissed as "worn-out psychological operations." The closure of the Strait of Hormuz, integral for global oil supply, has heightened fears of energy-driven inflation, particularly affecting Europe which depends on the strait for its oil imports.

Corporate movements saw SAP's shares fall by 2.2% following a downgrade to neutral by J.P. Morgan, while Puig surged 16% amid talks of a potential merger with Estée Lauder and the Spanish beauty company. Investors are also closely monitoring euro zone flash PMI readings due later today.