European Shares Seen Tad Lower Ahead Of US Inflation Data, Bank Earnings

European stocks are likely to open on a cautious note Thursday as investors await the all-important U.S. consumer inflation report and earnings from the biggest U.S. banks for directional cues.

Today’s CPI print for September may influence the Fed’s path forward on rates.

Major U.S. banks like JPMorgan Chase, Citigroup, Wells Fargo and Morgan Stanley are due to unveil their financial results on Friday.

Asian markets were mostly lower as investors weighed the risks of a global recession amid hawkish Fed rhetoric, escalating geopolitical tensions, China’s continuing COVID-19 restrictions and a renewed sell-off in U.K. government bonds.

As Europe scrambles to secure its energy infrastructure, Russian Vladimir Putin offered to redirect natural-gas supplies to Europe via Turkey, thereby making Turkey “the largest gas hub for Europe.”

In another development, G7 leaders have warned of ‘severe consequences’ if Russia uses nuclear weapons on Ukraine.

The dollar struggled for momentum despite U.S. Treasury Secretary Janet Yellen giving a nod of approval to the dollar rally, saying that U.S. policymakers are not concerned with the strong dollar right now.

Gold moved in a tight range and the British pound held onto its overnight gains, while oil prices were flat to slightly higher following three sessions of losses.

Destatis is scheduled to issue Germany’s final consumer and harmonized price data for September later in the day.

Consumer price inflation hit a new record 10.0 percent in September versus 7.9 percent in August. The statistical office is set to confirm the preliminary estimate published on September 29.

Overnight, U.S. stocks reversed course to end lower as producer prices rose more than expected in September and the latest Fed meeting minutes reiterated the central bank’s resolve in dampening inflation, with the summary of economic projections pointing to a terminal rate of around 4.6 percent.

The S&P 500 eased 0.3 percent to notch its sixth consecutive loss, while the Dow and the tech-heavy Nasdaq Composite both finished marginally lower.

European stocks extended their losing streak for the sixth straight session on Wednesday amid concerns over slowing global growth, rising interest rates and escalating geopolitical tensions.

The pan European Stoxx 600 dropped half a percent. The German DAX shed 0.4 percent, France’s CAC 40 index slipped 0.3 percent and the U.K.’s FTSE 100 declined 0.9 percent.

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