European stocks largely flat ahead of crucial U.S. CPI Release

The European stock market traded in tight ranges Tuesday, largely unchanged ahead of U.S. inflation data being released later in the session. This could set the tone for the remainder of the year.

At 03:50 ET (08.50 GMT), the DAX Index in Germany traded 0.1% lower, while the FTSE 100 U.K. climbed 0.1% and the CAC40 in France fell 0.1%.

The global stock market is largely holding ahead of the U.S. consumer prices index November. This index is expected to moderate to 7.3% from 7.7% in the previous month. However, the core inflation continues to be steady at 0.3% month on month.

Investors remain cautious about the risk of further increases in borrowing costs harming economies. Signs of inflation remaining elevated could stop the Federal Reserve slowing down its aggressive rate rises after its last policy-setting meeting.

In Europe, the U.K. claimant number increased by 30500 in November while the October unemployment rates rose from 3.6% to 3.7% in the previous month as the country’s labor force began to feel the effects of the slowdown in consumer spending.

Furthermore, U.K. wages rose 6.1% in October, faster than any other month on record. This gives more reason for the Bank of England increase interest rates when it meets on Thursday.

The headline annual German CPI number was 10.0% in November, a decrease of 10.4% from the previous month.

Investors will also be focusing on the German ZEW economic sentiment survey. This survey is expected to show a slight increase in confidence in the largest economy in the Eurozone, before Thursday’s meeting with the European Central Bank.

InterContinental Hotels Group (LON ) stock rose 0.2% following the announcement by the owner of Holiday Inn that Michael Glover, the finance chief for its Americas division, and group head of finance, would be promoted to chief financial officer.

Chemring (LON CHG Stock fell 0.8% despite U.K. defense company reporting an increase in profits and maintaining its guidance for this year. It stated that Russia’s invasion is having a profound impact on defense spending priorities and priorities.

On the back of continued worries about tightening supplies, crude oil prices rose on the previous session’s gains. The Keystone pipeline connecting the U.S. with Canada remained closed.

Since Dec. 7, when a huge leakage in Kansas, U.S., was reported, Keystone has been closed. This prevented approximately 620,000 barrels per day of Canadian crude oil from entering the United States. The United States is the largest consumer of crude oil in the world.

The closure of the pipeline is likely to be reflected on the U.S. crude inventories. The latest numbers from the American Petroleum Institute are due Tuesday, ahead of the official data from Energy Information Administration Wednesday.

The tone was also helped by comments made late Monday by China’s ambassador in the U.S., indicating that the country would continue to relax its COVID-19 strict measures.

U.S. U.S. crude futures were 1.3% higher at $74.14 per barrel while Brent rose 1.6% to $79.20 Both benchmarks were up by more than 2% during the previous session.

Leave a Comment

Your email address will not be published. Required fields are marked *