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European Markets Seen Opening Higher

stockmarkets aug17 20sep19 lt

European markets look headed for a positive start on Friday amid optimism the stimulus packages announced by central banks will help boost economic growth in the region.

Fairly strong U.S. economic data, including reports showing continued growth in Philadelphia region manufacturing activity, lower than expected increase in jobless claims and an unexpected jump in existing home sales are likely to aid sentiment.

Investors will be tracking the developments on the trade front. Senior U.S. and Chinese officials, who met in Washington yesterday for trade talks, will continue their discussions on Friday.

In Brexit news, Brexit Secretary Stephen Barclay is set to meet the European Union's chief negotiator Michel Barnier in Brussels.

Higher gold and crude oil prices may also aid sentiment.

In corporate news, BAE Systems has been awarded a $495 million U.S. defense contract for receiver/processors and high band receivers.

At 2.00 am ET, Destatis publishes Germany's producer prices for August. Producer price inflation is forecast to ease to 0.6% from 1.1% in July.

At 3.00 am ET, consumer confidence survey data for Turkey is due and at 4.00 am ET, Statistics Poland is scheduled to release the country's retail sales data for August.

Later, at 10.00 am ET, Eurozone flash consumer sentiment survey data is due. Economists expect the confidence index to rise slightly to -7 in September from -7.1 in August.

European markets ended mostly higher on Thursday, reacting positively to the U.S. Federal Reserve's decision yesterday to cut its key rates by 25 basis points.

Although the Fed did not give any hint about future rate cuts, it reiterated that it would act as appropriate to support economic expansion.

The Bank of England held interest rates steady and the quantitative easing program intact on Thursday amid continued uncertainty about Brexit.

Major European indices ended with solid gains on Thursday. The pan European Stoxx 600 ended up 0.61%. France's CAC 40 gained 0.68%, the U.K.'s FTSE 100 advanced 0.58% and Germany's DAX ended up 0.55%, while Switzerland's SMI closed 0.46% up.

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