European Shares Set For Steady Open

European stocks may open slightly higher on Tuesday as investors react to the latest comments from Federal Reserve officials and look ahead to a slew of U.S. data this week for fresh insights on the Federal Reserve’s next policy move.

Chicago Fed President Austan Goolsbee said on Monday that he was confused by market reaction to Fed Chief’s remarks on possible rate cuts and the U.S. central bank is not precommiting to cutting rates soon and swiftly.

Cleveland Fed President Loretta Mester also said that financial markets had got “a little bit ahead” of the central bank with respect to rate cut expectations.

Nonetheless, CME Group’s FedWatch Tool still suggests there is a good chance the Fed will lower interest rates by a quarter point in March.

The U.S. economic calendar remains busy this week, with investors keenly awaiting the latest readings on personal consumption expenditures, revised GDP, current account balance, home sales and initial jobless claims.

The Commerce Department’s report on personal income and spending for November includes readings on inflation said to be preferred by the Fed.

Asian stocks traded mostly lower, with Japan’s Nikkei rallying over 1 percent after the Bank of Japan expectedly left its ultra-loose monetary policy unchanged and voted unanimously to keep its yield curve policy.

Chinese and Hong Kong stocks were declining after a magnitude-6.2 earthquake jolted a remote and mountainous county on the northern edge of the Qinghai-Tibetan plateau around midnight on Tuesday.

The dollar edged lower, and gold traded slightly weak while oil extended gains to hit a two-week high on increasing supply concerns as more companies shun the Red Sea because of increased attacks on commercial vessels by Houthi militants in Yemen.

U.S. stocks edged higher overnight amid renewed optimism that the Federal Reserve will cut interest rates next year. Merger & acquisition buzz also boosted sentiment.

The Dow inched up marginally, the tech-heavy Nasdaq Composite gained 0.6 percent and the S&P 500 added half a percent.

European stocks closed mostly lower on Monday after five straight weeks of gains. The pan European STOXX 600 slipped 0.3 percent.

France’s CAC 40 shed 0.4 percent and the German DAX gave up 0.6 percent while the U.K.’s FTSE 100 rose half a percent.