Yahoo Finance European Stocks Seen Largely Higher; Virus Outbreaks Still a Worry
By Peter Nurse
Investing.com - European stock markets are seen largely rebounding Tuesday after the previous session’s sharp losses. However, the overall tone remains weak amid concerns that the region’s recovery will be stymied by fresh lockdowns.
At 2:05 AM ET (0605 GMT), the DAX futures contract in Germany traded 0.2% lower, but CAC 40 futures in France climbed 0.6% and the FTSE 100 futures contract in the U.K. rose 0.6%. European stocks sold off sharply on Monday, with these three benchmark cash indexes all dropping over 3%.
A fresh Covid-19 outbreak in Europe is increasing fears of more new lockdowns on the continent, with the U.K. due to announce new restrictions on bars and restaurants later Tuesday.
On Monday, the U.K. government’s Chief Scientific Adviser Patrick Vallance warned that the rate of infections could reach around 50,000 a day by mid-October without curbs.
A number of European countries, including France, Spain and Greece, have already implemented new restrictive measures, while Germany’s health minister said the trend of cases is “worrying.”
The economic data slate is largely empty in Europe Tuesday. Instead, investors are likely to concentrate on U.S. Federal Reserve Chair Jerome Powell, as he makes the first of three appearances on Capitol Hill this week to discuss the central bank’s response to the coronavirus pandemic.
In corporate news, banks will remain in focus after Monday’s substantial losses on the back of a report alleging that several continued to profit from transactions with suspicious entities despite flagging up concerns to the authorities.
LVMH (PA:LVMH) may also be in the spotlight after a U.S. court set a January date for Tiffany's (NYSE:TIF) lawsuit against the French luxury goods conglomerate for trying to back out of its $16 billion deal to acquire the jeweler.
Oil prices drifted lower Tuesday, continuing the previous session’s weakness despite Tropical Storm Beta proving less disruptive to the infrastructure in the Gulf of Mexico than feared. However, persistent worries about fuel demand as coronavirus cases continue to flare up around the globe remain a drag.
Traders will be watching out for the American Petroleum Institute's data on U.S. oil inventories due later on Tuesday.
U.S. crude futures traded 0.1% lower at $39.51 a barrel, while the international benchmark Brent contract fell 0.1% to $41.41. Both oil benchmarks fell around 4% on Monday.
Elsewhere, gold futures rose 0.4% to $1,917.95/oz, while EUR/USD traded 0.1% lower at 1.1754.
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