European Shares Seen Up Despite Growth Concerns

European stocks may open higher on Wednesday as investors weigh growth worries against optimism about the rollout of coronavirus vaccines and central bank support.

Asian markets traded mixed as weaker-than-expected Chinese economic data rekindled worries about slowing global growth.

China’s industrial output in August rose at its weakest pace since July 2020 and retail sales growth also slowed significantly due to strict COVID-19 curbs, heightening concerns about slowing growth in the world’s second-biggest economy.

Virus worries persist, with Singapore reporting its highest number of COVID-19 cases since August last year.

Softer-than-expected CPI data weighed on the dollar index, helping lift gold to a one-week high. Oil prices climbed after a larger than expected drawdown in crude oil stocks in the United States.

Expectations that vaccination rates will contribute to economic recovery from COVID-19 also improved the fuel demand outlook.

It’s a busier day ahead on the Eurozone’s economic calendar, with industrial production figures for the region and finalized inflation figures for France likely to impact markets.

Across the Atlantic, a Fed report on industrial production may attract attention along with separate reports on import and export prices and New York manufacturing activity.

The Fed is scheduled to hold a monetary policy meeting next week, with many expecting the central bank to provide an update on the outlook for its asset purchase program.

U.S. stocks ended lower overnight as economic uncertainties and the increasing likelihood of a corporate tax rate overshadowed signs of easing inflation.

The Dow shed 0.8 percent to reach its lowest closing level in almost two months, while the S&P 500 dropped 0.6 percent and the tech-heavy Nasdaq Composite eased half a percent.

European stocks ended mixed on Tuesday as relatively tame U.S. inflation data generated optimism that the Federal Reserve may delay plans to begin scaling back stimulus.

The pan European Stoxx 600 ended almost unchanged. The German DAX inched up 0.1 percent, while France’s CAC 40 index eased 0.4 percent and the U.K.’s FTSE 100 dipped half a percent.

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