European Shares May See Flat Opening Ahead Of Central Bank Meetings
European stocks may open flat to slightly higher on Monday as traders look ahead to a busy week of economic data releases and central bank meetings.
The dollar held steady while gold dipped below $2,000 per ounce ahead of a busy week, with U.S. inflation data and a final rate decision of the year by the Federal Reserve in the spotlight.
The Fed is widely expected to leave interest rates unchanged, with traders likely to focus more closely on the central bank’s accompanying statement and projections for clarity on whether the U.S. central bank will aggressively cut rates next year.
This week also features the Swiss National Bank (SNB), the Bank of England (BoE) and the European Central Bank (ECB) monetary policy meetings.
In economic releases, reports on U.S. consumer and producer price inflation along with data on retail sales and industrial production may attract attention.
Asian markets traded mixed, with Hong Kong’s Hang Seng index falling nearly 2 percent on concerns over rising deflationary pressures in China.
China’s consumer prices fell the fastest in three years in November and producer price inflation fell further into negative territory, underscoring the challenges facing the world’s second-largest economy.
Japan’s Nikkei was up 1.5 percent, and the yen gave up some of its recent strong gains after reports that BoJ Governor Kazuo Ueda’s comments last week were taken out of context.
U.S. stock futures struggled for direction after Wall Street notched a sixth straight weekly gain.
Oil extended Friday’s rally following calls from Saudi Arabia and Russia for OPEC+ members to joint output cuts. U.S. efforts to replenish strategic reserves also boosted oil prices.
U.S. stocks hit a new high for 2023 on Friday as solid economic data fueled hopes for a soft landing of the economy.
While November’s nonfarm payrolls report showed stronger-than-expected job growth and an unexpected drop in the unemployment rate, a University of Michigan report showed a pullback in consumers’ inflation expectations in December.
The Dow and the S&P 500 both edged up around 0.4 percent, while the tech-heavy Nasdaq Composite gained half a percent.
European stocks advanced on Friday to briefly hit their highest level since February 2022 on growing bets that central banks have finished raising rates and will start cutting rates early next year.
The pan European STOXX 600 rose 0.7 percent. The German DAX surged 0.8 percent, France’s CAC 40 rallied 1.3 percent and the U.K.’s FTSE 100 added half a percent.
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