European Shares Likely To Open On Cautious Note

European stocks may open flat to slightly lower on Tuesday after no progress was made at Cairo ceasefire talks and more Federal Reserve officials downplayed any urgency to cutting interest rates.

Oil prices traded higher today as hopes diminished that negotiations between Israel and Hamas would lead to a ceasefire in Gaza.

In a statement published early today, Hamas said the latest deal proposed by Israel does not meet their demands.

In another development, Israeli Prime Minister Benjamin Netanyahu said the timing for a ground offensive in the Gazan city of Rafah, where an estimated 1.5 million Palestinians are sheltering, has been set.

Meanwhile, investors scaled down their expectations for Fed rate cuts further following hawkish commentary from Chicago Fed President Austan Goolsbee and his Minneapolis counterpart Neel Kashkari.

Goolsbee said the U.S. central bank must weigh how long it can maintain the policy restrictive without damaging the economy.

Kashkari said the Fed cannot ‘stop short’ on the inflation fight.

Asian stocks traded mixed ahead of key U.S. inflation readings, the release of FOMC meetings, the ECB rate decision and earnings from major U.S. banks JPMorgan Chase, Citigroup and Wells Fargo due later in the week.

Oil prices saw modest gains in Asian trading while gold held near a record peak on heightened geopolitical tensions. Bond yields held steady at 2024 highs.

U.S. stocks fluctuated before eventually closing narrowly mixed overnight as 10-year yields spiked to five-month highs ahead of commentary from Fed officials and more U.S. data, including the closely watched inflation readings.

The Dow and the S&P 500 both slipped marginally while the tech-heavy Nasdaq Composite ended flat with a positive bias.

European stocks closed higher on Monday after the release of encouraging data on euro area investor confidence and German industrial production.

The pan European STOXX 600 gained half a percent. The German DAX climbed 0.8 percent, France’s CAC 40 added 0.7 percent and the U.K.’s FTSE 100 rose 0.4 percent.