Morning Bid: Tech and war jitters sap confidence

A look at the day ahead in European and global markets from Gregor Stuart Hunter

Oil is back on the boil and equity markets are struggling to find a floor after this week's selloff triggered by fresh blows to the ceasefire in the Middle East. The U.S. has launched new strikes against multiple targets in Iran, with President Donald Trump vowing even more attacks if no peace deal is secured.

Brent crude rose 1.7% to $94.64 after Iran's Islamic Revolutionary Guard Corps said on Thursday that they had retaliated against U.S. air bases in Kuwait and Bahrain, and threatened to target any vessel passing through the Strait of Hormuz.

Equities across the region slid, with MSCI's broadest index of Asia-Pacific shares outside Japan down 1.3% with Taiwanese and Korean shares leading declines as AI chipmakers fluctuated between gains and losses.

Some analysts have attributed the recent tech slump to investor repositioning ahead of the upcoming SpaceX share offering, which Reuters reported has drawn more than $250 billion of investor demand for what stands to be the largest-ever IPO.

Oracle also rattled sentiment, unveiling spending plans far beyond expectations and fuelling debt concerns - sending its shares plunging 10% in after-hours trade.

The euro edged up 0.1% to $1.1544 against the U.S. dollar ahead of the European Central Bank's June monetary policy announcement later on Thursday, where it is widely expected to hike rates.

The single currency held gains even as the flare-up in the Iran conflict kept the U.S. dollar index holding firmly at its strongest levels since ceasefire talks with Tehran began in early April. Wednesday's hot U.S. inflation print has nudged market bets toward an October rate hike, according to CME's FedWatch tool, though expectations remain finely balanced.

The yield on the U.S. 10-year Treasury bond was up 1.4 basis points at 4.552%.

U.S. equity futures found tentative footing, with S&P 500 e-mini futures up 0.2% and on track to snap a two-day losing streak. In early European deals, pan-region futures slumped 0.8%, German DAX futures were off 0.6% and FTSE futures fell 0.8%.

Key developments that could influence markets on Thursday:

Economic events:

Germany: Current account balance for April

Euro Zone: ECB monetary policy decision for June and press conference

U.S.: PPI for May

Debt auctions

UK: 3-year government debt

(Reporting by Gregor Stuart HunterEditing by Shri Navaratnam)