European Markets Brace For Muted Opening

Waning excitement over rate cuts, uncertainty about key labor market updates from the U.S. as well as the weak trend in Wall Street are seen keeping market sentiment subdued at the European bourses on Tuesday.

In major economic data releases, markets anticipate the ISM Services PMI and JOLTs Job Openings data from the U.S. as well as the third quarter GDP reading from Australia. No major data releases are due from Europe.

Wall Street had closed on a negative note on Monday as markets reassessed the monetary policy outlook. Anxiety ahead of monthly labor market update also weighed on sentiment. Nasdaq Composite slipped 0.84 percent to close at 14,185.49 whereas the Dow Jones Industrial Average edged down 0.11 percent to finish trading at 36,204.44.

Mixed sentiment prevailed in the European bourses on Monday amidst rate cut expectations as well as concerns about jobs data from the U.S. Switzerland’s SMI topped with gains of 0.60 percent. The pan-European Stoxx-50 edged down 0.09 percent. France’s CAC 40 dropped 0.18 percent. U.K.’s FTSE 100 slipped 0.22 percent. Oil, gas and miners recorded biggest losses.

Current indications from the European stock futures indicate a mixed sentiment. The FTSE 100 Futures (Dec) has declined 0.12 percent whereas the DAX Futures (Dec) is trading 0.11 percent lower. The CAC 40 Futures (Dec) has edged down 0.04 percent. The pan-European Stoxx 50 Futures (Dec) has edged up 0.05 percent. The SMI Futures (Dec) has however gained 1 percent.

American stock futures indicate mild losses. The US 30 (DJIA) is trading 0.15 percent lower, whereas the US500 (S&P 500) is trading 0.21 percent lower.

Asian stock markets are trading on an overwhelmingly negative note as concerns about economic growth in the region eclipsed stock market sentiment driven by rate cut hopes. Less than expected PMI readings from Japan also dampened sentiment. Hong Kong’s Hang Seng has tumbled 1.50 percent. Japan’s Nikkei 225 has plunged 1.22 percent. Australia’s S&P ASX 200 has declined 0.89 percent. China’s Shanghai Composite has lost 0.71 percent. South Korea’s KOSPI has lost 0.61 percent. DJ New Zealand has slipped 0.25 percent. Resisting the region’s bearish sentiment, India’s Nifty 50 scaled fresh peaks, gaining 0.65 percent.

The Dollar Index (DXY), a measure of the U.S. dollar’s strength relative to six currencies, edged down 0.11 percent to 103.60, from the previous close of 103.71. The EUR/USD pair has edged up 0.06 percent to 1.0842 whereas the GBP/USD pair has edged up 0.04 percent to trade at 1.2637.

Gold rebounded after Monday’s whipsawing prices. Gold Futures for February settlement is trading at $2,049.85, up 0.37 percent from the previous close of $2,042.20.

Crude oil prices also recovered from Monday’s correction. Brent Crude Futures for February settlement edged up 0.05 percent to $78.07 whereas WTI Crude Futures for January settlement gained 0.11 percent to $73.12.

Services PMI updates for November are due from Germany, France, U.K. as well as the Euro Area. Industrial production reading for October is due from France. Producer Price inflation reading for October is also due from the Euro Area.

Earnings updates due on Tuesday from the region include homebuilding supplies business Ferguson and diamond jewelry retailer Signet Jewelers.

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