European Stock Futures Edge Lower; Eurozone CPI Data Due

© Reuters.

By Peter Nurse

AiVIF.com - European stock markets are expected to open marginally lower Thursday as investors digest the minutes from the last Federal Reserve meeting, ahead of the final Eurozone inflation data for July.

At 02:00 ET (06:00 GMT), the DAX futures contract in Germany traded 0.4% lower, CAC 40 futures in France dropped 0.2%, and the FTSE 100 futures contract in the U.K. fell 0.2%.

Federal Reserve officials saw "little evidence" late last month that U.S. inflation pressures were easing, the minutes from the U.S. central bank’s July meeting showed when they were released on Wednesday.

That said, they did flag an eventual slowdown in the pace of hikes, but not a switch to cuts in 2023 that had been the widely held belief prior to the minutes’ release.

There still remains a great deal of uncertainty over the size of the interest rate hike when the Fed next meets in September, and this could keep stock markets in tight trading ranges ahead of next week’s central bankers get together at Jackson Hole.

Back in Europe, economic growth in the Eurozone for the second quarter was revised down on Wednesday from 0.7% to 0.6% quarter on quarter, and investors will turn to the latest estimates of inflation in the region although they aren't expected to deviate from preliminary estimates. These were up 8.9% on the year in July, a monthly rise of 0.1%.

European Central Bank board member Isabel Schnabel said Thursday, in an interview with Reuters, that the Eurozone inflation outlook has failed to improve since its July rate hike, suggesting she would vote for another large interest rate increase next month.

In corporate news, the earnings season is slowly coming to a close, but the likes of Applied Materials (NASDAQ:AMAT), Estee Lauder (NYSE:EL) and Adyen (AS:ADYEN) are scheduled Thursday to release quarterly numbers.

Oil prices held steady Thursday as traders weighed up falling U.S. stockpiles with concerns about a global slowdown.

U.S. crude stocks fell by a hefty 7.1 million barrels in the week to Aug. 12, Energy Information Administration data showed on Wednesday, much more than expected, while exports rose to a record and gasoline demand climbed to the highest this year.

Still, the market is on track for a weekly loss as fears over an economic downturn continue to hang over the market. The potential for the revival of the 2015 nuclear deal, and thus more oil from Iran, has added to the bearish sentiment.

By 02:00 ET, U.S. crude futures traded 0.1% lower at $88.05 a barrel, while the Brent contract fell 0.1% to $93.60.

Additionally, gold futures traded flat at $1,776.65/oz, while EUR/USD traded 0.2% lower at 1.0162.