European shares edge higher as oil falls; Nvidia earnings in focus

European shares climbed on Wednesday, with oil prices falling and bond yields dropping as hopes grew that the Strait of Hormuz might reopen soon. The pan-European STOXX 600 index rose 0.1% to 657.34, while basic resources led the sectoral gains, up 0.9%. Iran announced it had resumed talks with Oman over managing the Strait of Hormuz amid mounting pressure from US President Donald Trump in a nearly six-month conflict that has shaken oil markets and heightened global inflationary concerns.

Brent crude futures slid for a third day, falling over 2% to approximately $86 a barrel on expectations of increased oil flows through Hormuz, which helped push bond yields lower. The energy index declined 1.1% and was the worst-performing sector on the STOXX 600. Investors are now eagerly anticipating Nvidia's second-quarter earnings, released later in the day, to gauge whether the AI-driven spending boom can sustain lofty market expectations.

Tech shares slipped 0.2% ahead of the results. Furthermore, a key U.S. inflation report is due on Wednesday, providing investors with additional clues about the Federal Reserve's interest rate trajectory.