Investors digest data, Covid surge
LONDON — European stocks are expected to open around the flatline on Wednesday as investors monitor the latest data out of the euro zone and the region’s latest Covid surge.
The U.K.’s FTSE index is seen opening 6 points lower at 7,260, Germany’s DAX 4 points lower at 15,933, France’s CAC 40 up 1 point at 7,045 and Italy’s FTSE MIB up 84 points at 27,023, according to data from IG.
European markets continue to monitor the acute Covid crisis in the region this week, with more countries considering stricter Covid restrictions and partial lockdowns to curb rising infections.
Germany is expected to make a decision on stricter measures on Wednesday amid a surge in cases there, and France recorded more than 30,000 new daily infections on Tuesday for the first time since August.
Investors are also digesting the latest business activity data from the region; European stocks retreated on Tuesday, closing lower, despite data showing that euro zone business activity grew unexpectedly in November.
IHS Markit’s flash composite purchasing manager’s index (PMI), a useful gauge of economic health, climbed to 55.8 in November from 54.2 in October, greatly outstripping expectations in a Reuters poll of economists for a drop to 53.2.
However, optimism about the immediate future for economic activity declined. It came amid a fresh wave of Covid-19 infections across the region and surging prices, and the outlook deteriorated for December.
Elsewhere overnight, U.S. stock futures were little changed after tech shares sold off for the second day in a row, pressured by rising rates that gave a boost to energy and financial stocks. Meanwhile, shares in Asia-Pacific were mixed in Wednesday trade, with Japanese stocks leading losses regionally.
Earnings come from Johnson Matthey, Virgin Money and United Utilities and data releases include the latest Ifo business climate survey from Germany.
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