European stock markets have begun today’s session slightly lower as investors seek direction ahead of GDP data.
As investors seek direction ahead of the publication of eurozone GDP statistics and the crucial central bank meetings next week, European stock markets have begun today’s session slightly lower.
Since President Christine Lagarde stated earlier this week that more interest rate increases will be necessary to address the persistent inflation pressures, it is largely believed that the ECB will increase interest rates by another 25 basis points on Thursday.
The Fed's future course of action is unclear, though. The consumer price index on Tuesday might be key, but last week's employment data showed the labour market is still tight. Futures traders still give the U.S. central bank a 70% chance of suspending rate rises next week.
Investors will likely pay close attention to the first quarter's revised gross domestic product statistics and the unemployment rate for the eurozone.
According to the initial GDP report, the area had a 1.2% annual growth rate in the first three months of the year, a marked deceleration from the 1.8% increase recorded in the previous quarter.
Oil prices declined on Thursday as traders analysed erratic gasoline supplies in the US as well as enduring worries about the future of global demand.
Official statistics revealed that while petrol stocks increased for the first time in five weeks last week, crude inventories surprisingly decreased during that period. Given that it started the summer driving season, which typically causes a substantial increase in U.S. gasoline demand, this came as a surprise.
This week has been a wild one for the oil market. After the publication of negative Chinese trade data and an abundance of weak economic indicators from the U.S. and Eurozone, pointing to weak global demand, early gains on the basis of Saudi Arabia's unexpected output reduction rapidly disappeared.
Today’s Key Events:
- Eurozone GDP (YoY) (Q4) data is due at 10:00 AM GMT. Forecast of 1.2%.
- US Initial Jobless Claims are due at 13:30 PM. Forecast of 235K.
(Sources: investing.com, reuters.com)
