The stocks of Europe will open flat to fall on Tuesday as the markets in the region dismissed the recovery of Wall Street at the beginning of the week.
The data from IG reported that the FTSE index of the UK has witnessed a slight lower, Germany’s DAX fell 0.2 percent, France’s CAC 40 down 0.42 percent, and the FTSE MIB of Italy remained steady.
The gloomy market anticipated in Europe is following significant U.S. averages that reversed on Monday and were pushed by the artificial intelligence trade as well as fresh speculations of a Federal Reserve interest rate cut.
Therefore, the markets in Asia-Pacific also traded higher in the market overnight, enhanced by Wall Street’s rally. Any news that may influence the next monetary policy announcement by the Fed is still being followed with keen eyes by traders.
The CME FedWatch Tool shows that markets are putting a higher probability of over 80% of a quarter percentage point reduction by the Fed in December.
The chances have increased as the President and CEO of the Federal Reserve Bank of New York, John C. Williams, indicated last Friday that there will be expectations to reduce rates “in the near term.”
San Francisco Fed president Mary Daly told on Monday that the Wall Street Journal that she favors the reduction of the rates because of the labor market concerns.
The earnings will come from Compass Group, Easyjet, and Kingfisher, and the data releases involve German GDP and French consumer confidence in Europe on Tuesday.
The corporate news, Dutch lender ABN Amro announced on Tuesday that it would reduce its staff by 5 200 positions by 2028 due to efforts to downsize its operations and reduce costs.
The bank said that ahead of its Capital Markets Day, it had decided to sell its personal loans subsidiary Alfam to Rabobank.
Meanwhile, the regional defense stocks have been fluctuating throughout the last week as the U.S. keeps advancing toward reaching a peace deal with Ukraine.
The leaders of the European Union met to discuss the 28-point peace plan, which had been drafted by the American and Russian officials, without input from Ukraine or the rest of Europe.
As part of a preliminary draft, Ukraine would have allegedly been forced to make enormous concessions to Russia, such as the surrender of land that has been occupied following the full-scale invasion, and a reduction of the military, to call an end to the war.
President of the European Commission Ursula von der Leyen said in a statement that the meeting that Europe played a leading role in creating the future of Ukraine.
She added that “These are our core European principles moving forward: Ukraine’s territory and sovereignty must be respected. Only Ukraine, as a sovereign country, can make decisions regarding their armed forces, the choice of its destiny is in their own hands.”
However, she noted that negotiations between the so-called Coalition of the Willing would resume on Tuesday. The investors in the U.K. are also preparing for the Autumn Budget to take place on Wednesday, with a series of tax increases to be announced by the U.K. Chancellor, Rachel Reeves.
