EUR/USD Under Pressure as Bond Yields Surge; US-Iran Talks Stall

European markets opened with a cautious tone on Tuesday as risk sentiment remains tepid amid stalled US-Iran negotiations and persistent bond market stress. S&P 500 futures edged up 0.2%, while major European indices posted minor losses at the open, reflecting limited conviction among traders. The EUR/USD pair faces headwinds as French 10-year yields approach the critical 4% threshold, having surged approximately 26 basis points this month to reach their highest levels since 2009. Rising eurozone bond yields signal deepening fiscal concerns that could weigh on the euro despite typically supporting currencies through higher rate differentials. The lack of a breakthrough in US-Iran diplomatic efforts adds a layer of geopolitical uncertainty, keeping safe-haven flows in play and limiting risk appetite. Bond markets globally remain under pressure, suggesting broader tightening financial conditions. Traders should monitor developments in US-Iran talks for potential risk-on catalysts, while the 4% level on French 10-year yields represents a key psychological barrier that could trigger further eurozone volatility if breached.