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Oil Climbs Again as Middle East Tensions Keep Markets Nervous

Market sentiment remains uncertain on Tuesday as investors continue monitoring the growing economic impact of the Middle East conflict. Oil prices briefly pulled back after comments from Donald Trump suggested the US would avoid immediate military action against Iran, but the decline was short-lived. Brent crude quickly recovered and moved back above $110.40 during the European session, showing that traders remain worried about supply risks and the absence of any meaningful diplomatic breakthrough.

European stock markets opened higher for a second straight session, supported by gains in industrial and defensive sectors. Europe’s smaller exposure to major technology stocks is helping regional indices stay relatively stable compared to the US market, where tech shares continue facing pressure. At the same time, rising global bond yields are keeping investors cautious. US Treasury yields pushed back above 4.6%, lifting European yields and strengthening the US Dollar across the board. The pound slipped below 1.34 against the dollar, while the euro also weakened during early trading.

UK Labour Market Weakness Adds Pressure on the Economy

The latest UK employment figures pointed to further softness in the economy. Unemployment rose back to 5%, while job vacancies dropped to their lowest level in five years. Wage growth also slowed, and payroll data showed another decline in employment levels during March.

The weaker labour market is creating uncertainty around the next moves from the Bank of England. While markets are still pricing in additional rate hikes this year, slowing employment conditions may reduce the need for aggressive tightening. Higher Gilt yields have already tightened financial conditions significantly, which could allow the central bank to stay cautious in the near term.

AI Job Cuts Spread Beyond Tech Companies

Artificial intelligence-related restructuring is now expanding into the banking industry. Standard Chartered announced plans to cut around 15% of its back-office workforce by 2030 as AI adoption increases across operations. Most of the reductions are expected in India, China, and Poland, but investors fear other financial institutions could follow a similar path.

Despite the growing focus on AI-driven efficiency, markets have not rewarded companies announcing layoffs. Shares of Snap Inc. and Salesforce remain heavily lower this year, suggesting investors are more concerned about long-term growth than short-term cost savings.

Rising Oil Prices Start Hurting the AI Sector

The surge in energy prices is beginning to create new risks for the technology sector. Investors are increasingly worried that prolonged geopolitical tensions and expensive energy could eventually damage semiconductor production and the economics of operating large AI data centres.

Important materials used in chip manufacturing, including helium and precious metals, are becoming more costly as supply chain risks rise. While firms such as TSMC and Infineon Technologies have not yet issued major earnings warnings, a prolonged conflict could eventually slow investment across the AI industry.

Attention is now turning toward Nvidia ahead of its upcoming earnings release. Investors will closely watch its outlook on AI demand and future chip sales, as the results could shape the next major move in US technology stocks. Nasdaq futures remain under pressure ahead of the US session.

Brent Crude Outlook: Buyers Continue Defending Support

Brent crude remains technically supported despite recent volatility. On the 4-hour chart, buyers continue defending the key $111 support area after the strong rebound from the broader $100–$105 demand zone.

Momentum indicators are gradually improving, showing that bullish pressure is rebuilding as price moves closer to the $114.7 resistance level. If buyers manage to break above $115, the next upside target could open toward the $119–$120 region.

On the downside, a move below $111 could weaken the current bullish structure and trigger another correction toward $106.

For now, Brent crude remains cautiously bullish while trading above major support levels.