The stock market is trading flat, restrained by worries over the recession.

Stock markets open in a subdued manner on Wednesday as investors counter fears about the local recession with news of China's reopening.

Early on Wednesday, Chinese authorities reported that a number of COVID regulations had been loosened, including those requiring tests for entry into the majority of public places and enabling some people to quarantine at home.

These actions come after frustration over the country's severe movement restrictions designed to stop a new virus breakout.

These tough regulations have slowed China's economic growth this year, and the relaxation is anticipated to spark the second-largest economy in the world and a significant export market for European businesses.

Investors must currently contend with sluggish growth and tightening monetary policy to address rising inflation.

Even though interest rates are currently "quite close" to their neutral level, the European Central Bank is set to raise them again next week, according to ECB policymaker Constantinos Herodotou.

After a big surge towards the back end of this year, Goldman Sachs analysts predict that markets will have a difficult start to 2023, falling in the first half before rising in the second.

According to Goldman Sachs, "we expect 2023 to prove tougher after the resilience in earnings this year," citing margin pressure brought on by rising costs that would be more difficult to pass through in a recession.

Better than expected, but still indicative of the challenges the region's economic powerhouse is facing, data released on Wednesday indicated that German industrial production decreased by 0.1% on a monthly basis in October.

The third quarter GDP for the Eurozone is predicted to show a slender 0.2% increase over the previous quarter, and employment data is also due.

China recorded fewer new COVID-19 infections for two straight days and also lifted a variety of COVID limitations, which helped the price of crude oil settle early on Wednesday.

According to information issued on Tuesday, the American Petroleum Institute, an industry group, predicted a reduction in U.S. crude stockpiles of about 6.4 million barrels last week. This suggests that demand in the world's top consumer remained strong.

Later on Wednesday, the Energy Information Administration is expected to release its official statistics.

(Sources: investing.com, reuters.com, proactiveinvestorsuk.com)