European Shares Seen Lower As Recession Fears Swirl

European stocks may open on a tepid note Thursday as worries about economic growth and earnings returned to the fore.

Asian markets traded on a mixed note while U.S. stock futures slipped, a day after the S&P 500 posted its worst day loss in more than a month.

The dollar recovered from an eight-month low amid safe-haven demand along with technical buying after recent string of losses.

Gold traded firm above $1,900 per ounce and oil prices fell over 1 percent as worries about a recession swirled everywhere.

The Japanese yen recovered some ground amid speculation that rising inflation will push the Bank of Japan into eventually altering its ultra-loose monetary policy.

On the economic front, speeches by ECB President Christine Lagarde and some Fed officials at Davos along with U.S. reports on weekly jobless claims, housing starts and Philadelphia-area manufacturing activity may sway sentiment as the day progresses.

U.S. stocks reversed course to end sharply lower overnight, as investors reacted to weak economic data and comments from St. Louis Fed President James Bullard and Cleveland Fed President Loretta Mester expressing support for raising rates beyond 5 percent.

Retail sales, producer prices and production at U.S. factories fell more than expected in December, rekindling concerns over the outlook for growth and corporate earnings.

The Dow plunged 1.8 percent, the tech-heavy Nasdaq Composite lost 1.2 percent and the S&P 500 shed 1.6 percent.

European stocks ended mixed on Wednesday, as China ramped up COVID preparations ahead of the Lunar New Year holidays and data showed inflation in the United Kingdom eased further for the second consecutive month.

The pan European STOXX 600 rose 0.2 percent to extend its winning streak for a sixth straight session as IMF chief said growth will bottom out in 2023.

The German DAX finished marginally lower and the U.K.’s FTSE 100 slipped 0.3 percent while France’s CAC 40 index ended flat with a positive bias.