Stock Market

Euro Zone Retail Sales in Focus as European Stock Futures Inch Up

The European stock markets are set to open slightly higher on Tuesday, buoyed by gains in Asian markets. The DAX, CAC 40, and FTSE 100 futures contracts in Germany, France, and the UK respectively, are all up by 0.3% to 0.4%. After the long Easter weekend, European equities are expected to start the day positively, supported by improved sentiment in Asia, with the Nikkei 225 index rising over 1% on news that Warren Buffett is looking to increase his holdings in Japanese stocks.

The only economic release of note on the calendar is the latest euro zone retail sales data for February, which is expected to show a monthly decline of 0.8%, and an annual drop of 3.5%, indicating the impact of rising prices on consumers’ disposable income.

In the US, all eyes will be on Wednesday’s inflation data and the minutes of the Federal Reserve’s March meeting for further clues on future monetary policy, after Friday’s official jobs report showed nonfarm payrolls increased by 236,000 jobs in March, pushing the unemployment rate down to 3.5%. This could pave the way for the Fed to hike interest rates again in May.

Meanwhile, oil prices rose on Tuesday on hopes of demand growth in Asia and expectations of falling inventories in the US. Indian fuel consumption jumped 5% in March from a year earlier, while Chinese airlines are reportedly hiring en masse, anticipating a rebound in travel demand after the country’s anti-COVID restrictions are relaxed. The American Petroleum Institute is expected to release its weekly data on US crude stockpiles later in the day, with another fall anticipated after last week’s drop of over 4 million barrels. Gold futures also rose, while the EUR/USD currency pair traded higher.

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