(RTTNews) – European stocks could open slightly higher on Tuesday as investors react to the latest comments from Federal Reserve officials and look ahead to a slew of US data this week for new insights into the Federal Reserve’s next policy move.
Chicago Fed President Austan Goolsbee said Monday he was confused by the market’s reaction to the Fed Chief’s comments about possible rate cuts and that the U.S. central bank has no plans to cut rates quickly.
Cleveland Fed President Loretta Mester also said financial markets were “a little bit ahead” of the central bank in expectations for rate cuts.
Nevertheless, CME Group’s FedWatch Tool still suggests there is a good chance the Fed will cut rates by a quarter point in March.
The US economic calendar remains busy this week, with investors eagerly awaiting the latest data on personal consumption expenditure, revised GDP, current account balances, home sales and initial unemployment claims.
The Commerce Department’s report on personal income and expenditures for November includes inflation figures that the Fed says are preferable.
Asian shares traded mostly lower, with Japan’s Nikkei rising more than 1 percent after the Bank of Japan expectedly left its ultra-loose monetary policy unchanged and voted unanimously to maintain its yield curve policy.
Chinese and Hong Kong shares fell after a magnitude 6.2 earthquake struck a remote and mountainous area on the northern edge of the Qinghai-Tibetan plateau around midnight on Tuesday.
The dollar fell slightly and gold traded somewhat weak, while oil rose its gains to a two-week high on growing supply concerns as more companies avoid the Red Sea due to increased attacks on commercial ships by Houthi militants in Yemen.
US stocks rose higher overnight amid renewed optimism that the Federal Reserve will cut interest rates next year. Rumors of mergers and acquisitions also strengthened sentiment.
The Dow Jones rose marginally, the tech-heavy Nasdaq Composite gained 0.6 percent and the S&P 500 gained half a percent.
European shares closed mostly lower on Monday after five consecutive weeks of gains. The pan-European STOXX 600 fell 0.3 percent.
The French CAC 40 lost 0.4 percent and the German DAX lost 0.6 percent, while the British FTSE 100 rose half a percent.
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