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European Shares Seen Up On Stimulus Bets

stockmarkets jan11 11aug20 lt

European stocks are seen opening higher on Tuesday as investors clung to hopes of a bipartisan stimulus deal in Washington.

Market participants remain hopeful that U.S. Republicans and Democrats will eventually agree a comprehensive stimulus package to limit the economic damage caused by the coronavirus pandemic and boost growth.

U.S. congressional leaders and officials in President Donald Trump's administration said on Monday they were ready to resume coronavirus aid talks.

Asian markets remain broadly higher, the dollar held near a one-week high and oil extended gains to hover around $42 a barrel after New York, California and Texas reported a drop in coronavirus hospitalizations.

Senior U.S. and Chinese officials will meet via teleconference on Saturday to review the implementation of their Phase 1 trade deal.

In economic releases, U.K. like-for-like retail sales increased strongly in July as lockdown measures were eased and demand gradually began to return in some places, monthly data from the British Retail Consortium showed.

Like-for-like sales increased 4.3 percent on a yearly basis in July compared to an annual growth of 0.3 percent in the same period last year. On a total basis, retail sales grew 3.2 percent in July versus an increase of 0.5 percent in July 2019.

Labor market statistics from the U.K. and Germany's ZEW economic confidence survey results are due later in the session, headlining a light day for the European economic news.

The economic sentiment index for Germany is forecast to fall to 58.0 in August from 59.3 in July.

Across the Atlantic, the economic calendar remains relatively quiet, although traders are likely to keep an eye on the Labor Department's report on producer price inflation.

U.S. stocks ended mixed overnight as President Donald Trump signed executive orders aimed at extending coronavirus relief to Americans and Beijing announced it would sanction 11 U.S. citizens in response to similar measures from Washington.

The Dow Jones Industrial Average rallied 1.3 percent and the S&P 500 edged up 0.3 percent to reach their best closing levels in over five months, while the tech-heavy Nasdaq Composite index shed 0.4 percent.

European markets closed higher on Monday as investors reacted positively to last week's encouraging data on U.S. jobs growth and signs of improvement in China's industrial activity.

The pan European Stoxx 600 gained 0.3 percent. The German DAX inched up 0.1 percent, France's CAC 40 index edged up 0.4 percent and the U.K.'s FTSE 100 added 0.3 percent.

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