asiantrade.tv Wednesday should be a good day for European stock markets as investors look at the latest data on factory activity in China before the important Eurozone inflation report.
At 02:00 ET (06:00 GMT), the DAX futures contract in Germany was up 0.7%, the CAC 40 futures contract in France was up 0.4%, and the FTSE 100 futures contract in the United Kingdom was up 0.3%.
Related: Futures on European stocks go down, and the U.S. CPI is in the spotlight.
In August, Chinese industrial production declined for the second consecutive month, as COVID-19 lockdowns and a looming power shortage continued to impact economic activity.
August’s official Purchasing Managers’ Index for Manufacturing was 49.4. Even though this number was below 50, which means that the sector is shrinking, it was still better than July’s 49.0 and better than what was expected (49.2), which suggests a small improvement from the month before.
This is expected to result in a favourable start to the day in Europe; however, all eyes will be on the latest Eurozone consumer price index data. Inflation in Europe is expected to have hit a record high of 9 percent in August, putting more pressure on the European Central Bank to quickly raise interest rates next month.
Europe’s gas prices have gone down from record highs, but this drop may not last long because Russia has stopped sending gas to Germany through the Nord Stream pipeline for the second time in a month.
Also, the latest GDP numbers for France’s second quarter and Germany’s unemployment rate for August will be made public.
Related: Futures on European equities edge higher; U.S. inflation data is crucial this week.
Oil prices went up a little bit on Wednesday, making up for the big drops seen the day before. This was due to strong gasoline demand in the United States, which is the biggest consumer in the world.
The American Petroleum Institute, an industry group, said late Tuesday that oil stocks unexpectedly increased by 593,00 barrels last week. Nonetheless, gasoline inventories decreased by 3.4 million barrels, indicating that despite rising prices and interest rates, consumer demand for gasoline has remained strong.
Even so, oil prices are on track to go down for the third month in a row, which would be the longest losing streak in more than two years. This is mostly because investors expect the global economy to slow down as central banks quickly raise interest rates.
By 02:00 ET (06:00 GMT), U.S. oil futures had risen 0.9% to $92.45 per barrel, while the Brent contract increased 0.9% to $98.73 per barrel. Tuesday was the largest loss in about a month for both indices, as they both fell approximately 5%.
Related: European stock futures rise as Chinese aid sentiment improves.
In addition, gold futures declined to $1,735.90 per ounce, while EUR/USD rose 0.2% to 1.0034.
