European markets set to open flat as Wall Street rally pauses

• European stocks are expected to open flat on Thursday amid a pause in Wall Street rally and more muted trade in Asia Pacific due to the Lunar New Year public holiday.
• London's FTSE is seen 2 points higher at the open, at 6,515, Germany's DAX 2 points higher at 13,928, France's CAC 40 1 point higher at 5,665 and Italy's FTSE MIB 16 points higher at 23,230, according to calls from IG.

LONDON — European stocks are expected to open flat on Thursday amid a pause in Wall Street rally and more muted trade in Asia-Pacific due to the Lunar New Year holiday.

London's FTSE is seen 2 points higher at the open, at 6,515, Germany's DAX 2 points higher at 13,928, France's CAC 40 1 point higher at 5,665 and Italy's FTSE MIB 16 points higher at 23,230, according to calls from IG.

Investors in Europe will be keeping an eye on more earnings reports Thursday. Drugmaker AstraZeneca, banks Credit Agricole, Commerzbank and Unicredit and cosmetics company L'Oreal are among the biggest names to report earning, as well as Arcelormittal, Schneider Electric and Zurich Insurance.

A more cautious European market open reflects more muted trading elsewhere; U.S. stock index futures dipped during overnight trading Wednesday. Futures contracts tied to the Dow declined 31 points or 0.1%. S&P 500 futures and Nasdaq 100 futures each slipped 0.15%.

The move comes after the Dow advanced 63 points during regular trading hours, to close at a record high Wednesday in a volatile session, that saw the 30-stock average swing between gains and losses. The Dow also hit its ninth intraday record of the year.

Investors will be digesting comments from U.S. Federal Reserve Chairman Jerome Powell on Wednesday. He said that policy will need to stay "patiently accommodative" and that the U.S. is "a long way" from where it needs to be in terms of employment despite the economy having reclaimed more than 12 million jobs since the early days of the Covid pandemic.

Meanwhile, trading in Asia-Pacific was quieter overnight as multiple major markets in the region, including China, Japan, South Korea and Taiwan were closed for holidays. Markets in Hong Kong and Singapore also ended their trading sessions earlier than usual on Lunar New Year eve.

Data releases in Europe Thursday include Sweden's unemployment rate for January, Greece's unemployment rate for November and the Netherlands' trade balance data for December.

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