European stock futures are getting a little bit lower, and people are turning away from risk.
European stock markets are likely to open a little bit lower on Tuesday as investors worry about the region’s economic future and central banks keep trying to deal with high levels of inflation.
At 02:00 ET (07:00 GMT), the DAX futures contract in Germany was down 0.3%, the CAC 40 futures contract in France was down 0.2%, and the FTSE 100 futures contract in the U.K. was down 0.2%.
The risk-off sentiment is strong around the world on Tuesday, and European stocks are expected to close down like Wall Street did. This is because the U.S. services sector picked up unexpectedly in November, which made people worry that the Federal Reserve could keep tightening monetary policy aggressively.
Related: European shares slip with China’s COVID checks in focus
Back in Europe, the European Central Bank is also expected to raise interest rates next week. According to ECB chief economist Philip Lane, the European Central Bank will have to raise interest rates several more times to stop price pressure.
“We do think that more rate hikes will be needed, but a lot has already been done,” Lane was quoted as saying on Tuesday by the Italian newspaper Milano Finanza. “I would say with a fair amount of certainty that it’s likely we’re close to the peak of inflation.”
And the economy isn’t even in a good place to fall back on.
Business activity in the Eurozone fell for the fifth straight month in November, according to data released on Monday. This shows that the region’s economy is headed for a recession next year. Meanwhile, retail sales fell because consumers cut back on spending because inflation was going up.
Data released on Tuesday showed that industrial orders in Germany, which has the largest economy in the Eurozone, went up by 0.8% in October. This was more than what was expected, and it’s better than the revised 2.9% drop from the month before, but there’s not much to cheer about.
In the business world, Porsche AG (ETR:P911p) will be in the spotlight after exchange operator Deutsche Boerse announced on Monday that the sports car maker will join the German blue-chip DAX index on Dec. 19, just over two months after its market debut.
The sportswear company Puma (ETR:PUMG) will move down to the MDAX index, and Porsche AG will take its place.
Crude oil prices went up on Tuesday after falling sharply the day before. This was due to continued optimism about a recovery in Chinese demand, as more COVID limits were eased over the weekend in several cities in the world’s biggest crude importer.
Related: European stock futures are going down, and upcoming U.S. payrolls are making people nervous.
Oil prices fell more than 3% on Monday after strong data from the U.S. services sector. This happened as traders processed the EU ban on oil imports and the Group of Seven’s $60-a-barrel price cap on seaborne Russian oil.
By 2:00 p.m. ET, U.S. crude futures had gone up 0.8% to $77.56 per barrel, while the Brent contract went up 0.8% to $83.37 per barrel.
Also, gold futures dropped 0.1% to $1,780.45/oz, and EUR/USD fell 0.1% to 1.0483.
