© Reuters.
By Peter Nurse
Investing.com – European stock markets are expected to open lower Tuesday, after hawkish comments from Fed officials hit risk sentiment ahead of a widely-anticipated speech by Federal Reserve Chair Jerome Powell.
At 02:00 ET (07:00 GMT), the contract in Germany traded 0.7% lower, in France dropped 0.6%, while the contract in the U.K. fell 0.5%.
European stocks closed higher on Monday, trading near eight-month highs, on growing hopes that the Eurozone will only suffer a shallow recession in the new year, overturning earlier fears of a severe slowdown.
However, sentiment has shifted overnight after two Fed officials, and Mary Daly, said the U.S. central bank would likely hike (interest) rates to above 5% and hold them there for some time as it attempts to control inflation still at elevated levels.
Aggressive monetary tightening by the Fed has prompted fears of a recession in the U.S., likely weighing heavily on the global market given the importance of the largest economy in the world.
This brings a speech by later in the session firmly into focus, as investors look for more clarity on the pace of future rate hikes.
Back in Europe, rose 6.5% last month compared with a year earlier, according to data from the British Retail Consortium and KPMG, released earlier Tuesday.
“The numbers for sales growth in December look healthy,” said Paul Martin, U.K. head of retail at KPMG. “This is largely due to goods costing more and masks the fact that the volume of goods that people are buying is significantly down on this time last year.”
Other data due for release Tuesday include and numbers for November, as well .
In corporate news, Airbus (EPA:) is likely to be in the spotlight Tuesday with the aircraft manufacturer expected to announce its annual commercial aircraft orders and deliveries.
Oil prices fell Tuesday, handing back some of the previous session’s gains on fears that further interest rate hikes in the U.S., the largest consumer of crude in the world, would curb demand.
Industry group is scheduled to release its weekly data on U.S. crude inventories later in the session, while the Energy Information Administration, the statistical arm of the U.S. Department of Energy, is also due to release its .
By 02:00 ET, traded 0.3% lower at $74.38 a barrel, while the contract fell 0.4% to $79.33.
Both benchmarks climbed 1% on Monday, after China, the world’s biggest oil importer and second-largest consumer, opened its borders over the weekend for the first time in three years.
Additionally, fell 0.1% to $1,876.85/oz, while edged higher to 1.0730.
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