Updates prices and details throughout

By Tharuniyaa Lakshmi

May 20 (Reuters) - Canada's main stock index edged higher on Wednesday as progress in U.S.-Iran peace talks eased inflation worries, while investors awaited the release of chipmaker Nvidia's results - seen as a key test of AI demand - later in the day.

At 10:37 a.m. ET, the Toronto Stock Exchange's S&P/TSX Composite Index .GSPTSE was up 0.9% at 34,067.18 points.

Geopolitical worries eased after President Donald Trump again said on Tuesday that the Middle East war would be over "very quickly", while Vice President JD Vance talked up progress in negotiations for a peace deal.

Mining stocks .GSPTTMT on the resources-heavy index led gains, up 1.6%, as gold prices climbed supported by falling U.S. Treasury yields after the optimistic comments eased some inflation concerns. GOL/

Ten out of 11 sectors in the TSX were in the green. The energy sub-index .SPTTEN fell 1.5%, tracking losses in oil prices, which dropped more than 3%.

The index had come under pressure over the last two sessions as a selloff in the bond markets driven by inflation fears pushed yields higher.

On Wednesday, however, Canadian government 10-year bond yields CA10YT=RR fell 3.1 basis points to 3.673%. The yield on similar U.S. government benchmark debt fell to 4.6553%.

"It is still early to determine how much of the inflation will prove transitory versus how much will actually end up hitting the market. But all of this has investors very, very concerned about the state of affairs right now," said Shiraz Ahmed, founder at Sartorial Wealth.

Meanwhile, Nvidia NVDA.O, among the centerpieces of the global AI boom, rose 1.7% ahead of its quarterly results, which are due after the bell.

"Markets are shrugging off both good and bad news and continue to push higher. If Nvidia delivers in line with expectations, it could trigger a temporary bump in the stock and provide some support to broader sentiment," Ahmed said.