European Stocks Mixed; Investors Wait for Powell Speech

This post was originally published on this site – European stock markets are set to see mixed trading Wednesday, pausing after further records on Wall Street, as investors digest recent economic data ahead of a key speech from the head of the U.S. Federal Reserve.

At 2:05 AM ET (0605 GMT), the DAX futures contract in Germany traded 0.2% lower, the FTSE 100 futures contract in the U.K. rose 0.1%, while CAC 40 futures in France climbed 0.1%.

Tuesday saw a mixed trading session on Wall Street, as a rare pullback in Apple (NASDAQ:AAPL) stock hurt theDow Jones Industrial Average, which fell 60 points, or 0.2%. However, the S&P 500 gained 0.4% and the NASDAQ Compositejumped 0.8%, both settling in record territory.

Investors have been buoyed in recent days by signs of the Covid-19 virus receding and the Trump administration forcing the pace of authorizing treatments for it, as well as by progress in trade relations between the U.S. and China.

However, economic data has shown a mixed picture as far as the global recovery is concerned. 

In Europe, the German Ifo survey showed stronger-than-expected business sentiment, but consumer confidence dropped to a more than six-year low in the United States this month, data showed on Tuesday, overshadowing a boom in new home sales

“Renewed Covid containment measures and cuts to Federal unemployment benefits appear to be offsetting any positive boost from rising equity markets,” said analyst James Knightley at ING, in a research note. “With sentiment at its lowest point since the start of the crisis, it reinforces the view that the second phase of the recovery story will be slower going.”

With a light data calendar Wednesday, investors are looking to Thursday’s Jackson Hole symposium, where U.S. Federal Reserve Chairman Jerome Powell is due to give a speech, for further guidance on the central bank’s monetary policy framework review. 

Oil prices were higher Wednesday, continuing to post gains after settling at five-month highs on Tuesday, as U.S. producers prepared for the onslaught of Hurricane Laura by shutting most of their offshore output.

Laura is expected to make landfall late Wednesday or early Thursday along the Texas-Louisiana coast, a region that includes nearly half of U.S. refining capacity, as a Category 3 hurricane, according to the National Hurricane Center. 

Further price support came from data from the American Petroleum Institute showing U.S. crude oil stockpiles fell more than expected last week. The Energy Information Administration will release its own official inventory data later on Wednesday.

U.S. crude futures traded 0.1% higher at $43.38 a barrel, while the international benchmark Brent contract rose 0.2% to $46.36. 

Elsewhere, gold futures rose 0.1% to $1,923.90/oz, while EUR/USD traded 0.1% lower at 1.1818.