European Shares Seen Tad Higher At Open

European stocks are seen opening higher on Monday following a record setting week for the S&P 500.

Middle East concerns eased somewhat after the Israeli military said it had conducted a “series of strikes” on southern Gaza that have now “concluded,” without giving further details.

Separately, Iran’s foreign minister flagged the Israel-Hamas conflict could be moving closer to a diplomatic solution.

“Developments in Gaza are moving toward a diplomatic solution,” Iran’s Hossein Amirabdollahian said, without offering any specifics on timing.

Asian stocks traded mostly lower in thin trade, with major markets including China, Hong Kong, Japan, South Korea, Taiwan, Malaysia and Singapore closed for public holidays.

A cautious undertone prevailed as investors looked ahead to the release of key U.S. CPI data and comments from a slew of Fed officials this week for fresh clues on when the Federal Reserve is likely to begin cutting interest rates.

U.S. consumer price inflation is expected to have eased slightly in January but is likely to hold above the Fed’s annual 2 percent target.

Other key U.S. data due this week include readings on producer price inflation, retail sales and industrial production.

On the earnings front, Coca-Cola (KO), Kraft Heinz (KHC), Cisco (CSCO) and Deere (DE) are among the prominent companies due to report their quarterly results this week.

The dollar edged lower in Asian trade after a four-week climb. Gold struggled for direction on hawkish Fed expectations while oil dropped about half a percent following last week’s advance.

U.S. stocks rose on Friday after revised data showed U.S. monthly consumer prices rose less than initially estimated in December.

The tech-heavy Nasdaq Composite rallied 1.3 percent to close at its highest level in more than 2 years and the S&P 500 added 0.6 percent to end above 5,000 for the first time ever and book a fifth straight week of gains, while the narrower Dow slipped 0.1 percent.

European stocks closed lower on Friday as investors digested the latest batch of earnings, German inflation data and comments from BOE policymaker Jonathan Haskel that he wants more evidence of price stability.

The pan European STOXX 600 finished marginally lower. The German DAX and France’s CAC 40 both dipped around 0.2 percent while the U.K.’s FTSE 100 eased 0.3 percent.

Market Analysis