© Reuters.
By Peter Nurse
Investing.com – European stock markets are expected to open marginally higher Wednesday, struggling to maintain the week’s positive momentum as U.K. inflation data raised concerns about interest rate rises and slowing growth.
At 2:05 AM ET (0605 GMT), the contract in Germany traded 0.3% higher, in France climbed 0.3%, and the contract in the U.K. rose 0.2%.
European equities closed firmly higher Tuesday, with the leading the way, gaining 1.6%, as investors sought out bargains after these indices had received a battering the previous week on concerns that higher interest rates to combat inflation, COVID lockdowns in China and the war in Ukraine could push the region into recession.
However, data out of the U.K. early Wednesday showed hitting a 40-year high, climbed 9.0% on the year in April, a on the month.
Deputy Governor Dave Ramsden said last week that the central bank will have to raise further to control surging prices, and there’s a risk that the U.K.’s worst inflation crisis in decades will take longer to ease fully.
Similar data from the Eurozone is due later in the session and is expected to show at 7.5% in April, increasing the likelihood of the European Central Bank by 25 basis points in the summer.
European Central Bank Governing Council member Klaas Knot on Tuesday became the first Eurozone official to suggest a possible half-point interest rate hike if inflation risks worsen, though he backs a smaller move for now.
In the corporate sector, ABN AMRO (AS:) first quarter net profit above market expectations at 295 million euros ($310.8 million), helped by the reopening of Dutch society as pandemic restrictions were lifted.
Earnings from the likes of Burberry (LON:), British Land (LON:) and Premier Foods (LON:) are due Wednesday, while Siemens Energy (ETR:) will also be in the spotlight following reports that it’s preparing a bid to buy the remaining third of Spanish-listed wind turbine maker Siemens Gamesa (BME:) it does not already own.
Oil prices edged higher Wednesday on hopes that China is finally getting to grips with a prolonged COVID-19 outbreak, potentially increasing demand from the world’s largest importer of crude.
Shanghai, China’s main financial hub, achieved its milestone of three consecutive days with no new COVID-19 cases outside quarantine zones on Tuesday and laid out plans to end a more than six-week lockdown.
U.S. crude oil inventories unexpectedly fell by 2.4 million barrels for the week ended May 17, according to data from the industry body .
Investors now await crude oil supply data from the U.S. , due later in the day, for confirmation.
By 2:05 AM ET, traded 1.2% higher at $111.00 a barrel, while the contract rose 0.9% to $112.88.
Additionally, fell 0.3% to $1,813.18/oz, while traded 0.1% lower at 1.0536.
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