European Shares Poised For Lackluster Open
European stocks may struggle for direction at open on Tuesday after a private survey showed China’s factory activity fell into contraction territory for the first time since April.
Another report showed that average new home prices in 100 Chinese cities fell for a third consecutive month in July.
Japan, South Korea, Taiwan and Vietnam also saw manufacturing activity contracting in July, raising fresh concerns about the region’s fragile economic recovery.
Asian markets traded mixed, with losses capped somewhat on optimism that most global central banks may be either close to a peak or already done with interest-rate hiking.
Fed Bank of Chicago President Austan Goolsbee said on Monday that recent data showing slower inflation was promising and that all options are on the table for September.
Over the weekend, his Minneapolis counterpart Neel Kashkari called the inflation outlook in the U.S. as “quite positive.”
Earlier today, the Reserve Bank of Australia held interest rates steady but cautioned that further interest-rate rises might be needed to get inflation under control.
The dollar traded higher, keeping gold prices under pressure.
Oil prices were slightly lower after posting their biggest monthly gain in more than a year on expectations that Saudi Arabia would extend voluntary output cuts into September.
Eurozone and U.K. manufacturing PMI numbers along with the German labor market report are awaited later in the day.
Across the Atlantic, trading may be impacted by reaction to reports on manufacturing activity, construction spending and job openings.
U.S. stocks ended a lackluster session slightly higher overnight as data showed Chicago-area business activity contracted at a slightly slower rate in July.
The Dow gained 0.3 percent, while the tech-heavy Nasdaq Composite and the S&P 500 both rose around 0.2 percent.
European stocks closed mostly higher on Monday amid China stimulus optimism and encouraging Eurozone GDP and inflation data.
The pan European STOXX 600 edged up 0.1 percent. The German DAX slipped 0.1 percent, while France’s CAC 40 rose 0.3 percent and the U.K.’s FTSE 100 finished marginally higher.
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