By Peter Nurse
Investing.com – European stock markets are seen opening in a cautious fashion Tuesday, struggling for direction ahead of quarterly earnings reports from a number of big U.S. banks.
At 2:05 AM ET (0605 GMT), the contract in Germany traded 0.1% lower, in France dropped 0.1% and the contract in the U.K. fell 0.2%.
The European markets have received a largely positive handover from Asia, helped by news that China’s grew much more strongly than expected in June, indicating a recovery in global demand as vaccination programs reopened economies around the world.
Exports in dollar terms rose 32.2% in June from a year earlier, compared with 27.9% growth in May, and much stronger than the forecast increase of around 23%.
However, a lot of the focus Tuesday will be stateside as quarterly earnings reports are due this week from a number of major U.S. banks, including Goldman Sachs (NYSE:) and JPMorgan (NYSE:) later in the session. These numbers could be used as a gauge of the health of the economy as it reopens. In Europe, banks were in the news for the wrong reasons as Moody’s (NYSE:) Investor Service cut the main debt rating of Credit Suisse (SIX:) to A1 from Aa3 in the wake of its problems with Greensill Capital and the collapsed hedge fund Archegos.
Elsewhere, German rose 0.4% on the month in June, a rise of 2.3% on the year, falling from 2.5% in May, and a far cry from the 5.0% level seen in the U.S. in May.
An update on this data is due later Tuesday and will be in particular focus as investors try to gauge whether recent price pressures in the world’s largest economy persist.
In Covid-19 news, the number of hospitalizations are rising in some parts of the world, mostly where vaccination rates are low and driven by the highly contagious delta variant, according to comments from the World Health Organization on Monday. However, most fully vaccinated people who get delta infections are asymptomatic.
Elsewhere, oil prices pushed higher Tuesday, helped by the expectation of a further drop in inventories as demand picks up in the world’s largest consumer.
The is scheduled to release its crude oil supply data later in the session and inventories are expected to drop for an eighth consecutive week. They fell to the lowest since February 2020 in the week to July 2.
At 2:05 AM ET, U.S. crude futures traded 0.3% higher at $74.32 a barrel, while the contract rose 0.2% to $75.34.
Additionally, rose 0.2% to $1,810.30/oz, while traded flat at 1.1860.
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