European Shares Likely To Open On Tepid Note Amid Political Jitters

European stocks are seen opening broadly lower on Tuesday, with investor focus likely to be on the regional politics rather than economic updates.

French media anticipate a rough road ahead for French President Emmanuel Macron, with the country facing potential civil unrest and violence ahead of elections.

In a “Letter to the French” published on Monday, Macron has vowed to remain in office until May 2027 regardless of the outcome of the parliamentary elections on June 30 and July 7.

The United Kingdom is heading to the polls on July 4 and investors are bracing for the most distorted election result in British history.

Elsewhere, the stakes are high for U.S. President Joe Biden and Donald Trump for Thursday’s first presidential debate.

In economic news, investors await more U.S. data and comments from Fed officials this week for additional clues on the outlook for interest rates.

U.S. reports on new home sales, consumer confidence, durable goods orders and pending home sales may garner investor attention as the week progresses.

The Commerce Department’s report on personal income and spending for May is due on Friday, which includes readings on inflation said to be preferred by the Federal Reserve.

Asian markets were mostly higher this morning ahead of China’s May industrial profits and June manufacturing survey results due this weekend.

As trade tensions simmer, China’s Premier Li Qiang said the country is capable of achieving the full year growth target of around 5 percent.

Investors shrugged off reports suggesting that the Biden Administration was investigating major Chinese telecom firms over potential security concerns.

The battered yen languished near the 160 per dollar level while Treasury 10-year yields steadied after falling slightly in the previous session.

Gold edged lower after a top Federal Reserve official said that high interest rates are still needed to lower inflation.

Oil was little changed after moving higher on Monday as investors weighed the potential fallout from rising geopolitical tensions from Yemen to Russia.

Houthi militants are attacking commercial ships off Yemen with increasing — and sometimes deadly — effectiveness, while Russia squarely blamed the United States for a missile strike on occupied Crimea and warned of “consequences.”

U.S. stocks ended mixed overnight as a selloff in tech shares led by Nvidia continued, offsetting bets on Federal Reserve interest rate cuts this year.

The Dow climbed 0.7 percent to extend gains for a fifth straight session while the S&P 500 dipped 0.3 percent and the tech-heavy Nasdaq Composite shed 1.1 percent.

European stocks closed on a firm note Monday as bond yields eased, and the EU and China agreed to hold talks on planned electric vehicle tariffs.

The pan European STOXX 600 advanced 0.7 percent. The German DAX gained 0.9 percent, France’s CAC 40 rallied 1 percent and the U.K.’s FTSE 100 inched up half a percent.

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