European Shares To Open On Cautious Note On US Recession Fears

European Shares To Open On Cautious Note On US Recession Fears

April 19, 2023

European stocks may open on a cautious note on Thursday after the latest Fed minutes showed policymakers are eyeing a mild recession this year.

The U.S. dollar eased and Treasury yields were mixed while gold ticked higher as Wednesday’s CPI data bolstered expectations that the Fed’s hiking cycle may be nearing its end.

Oil prices were slightly lower after two day of strong gains on mounting signs of tighter supplies.

Asian markets followed Wall Street lower due to increased uncertainty surrounding the global economic outlook.

The European economic calendar remains light today, with monthly GDP data from the U.K. and final inflation figures from Germany due later in the session.

Across the Atlantic, trading later in the day may be impacted by reaction to the latest reports on weekly jobless claims and producer price inflation.

U.S. stocks ended lower overnight after minutes from the Federal Reserve’s March 21-22 policy meeting showed that central bank officials are concerned about elevated inflation and the regional bank liquidity crisis.

U.S. inflation rate eased to 5 percent in March, the lowest rise in almost 2 years, but many economists said they still expect the Fed to raise rates by another quarter point early next month.

The Dow slipped 0.1 percent, the S&P 500 shed 0.4 percent and the tech-heavy Nasdaq Composite lost 0.9 percent.

European stocks closed slightly higher on Wednesday as U.S. inflation eased in March and a top IMF official warned of a ‘hard landing” for the U.S. economy.

The pan-European STOXX 600 edged up 0.1 percent. The German DAX edged up 0.3 percent, France’s CAC 40 finished marginally higher and the U.K.’s FTSE 100 added half a percent.

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