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European Shares Seen Opening Tad Lower

stockmarkets jan04 12feb21 lt

European stocks are likely to open lower on Friday as investors weigh some tepid economic data against increasing vaccinations and the prospect of more stimulus.

U.S-China tensions remain on investors' radar after U.S. President Joe Biden warned the senators that China will "eat our lunch" if America doesn't "step up" its infrastructure spending.

Asian stocks fell in thin trade, with several markets closed for the Lunar New Year holiday. The dollar headed for a weekly loss after the release of disappointing U.S. economic data, while Bitcoin surged yet again to a new record high after Mastercard Inc. and Bank of New York Mellon Corp. moved to make it easier for customers to use cryptocurrencies.

Oil extended overnight losses after OPEC cut its demand forecast and the International Energy Agency said the re-balancing of the global oil markets remains "fragile".

In economic releases, the Office for National Statistics is scheduled to issue U.K. quarterly GDP, industrial production and foreign trade figures later in the session.

The British economy is forecast to grow 0.5 percent sequentially in the fourth quarter, slower than the 16 percent increase seen in the third quarter. Industrial output is seen rising 0.5 percent, in contrast to a 0.1 percent fall in November.

Across the Atlantic, the University of Michigan's preliminary report on consumer sentiment in February may attract attraction, although trading activity is likely to remain subdued ahead of the long weekend.

U.S. stocks ended mixed overnight as a decline in jobless claims signaled a modest firming of the labor market and Joe Biden affirmed the U.S.'s tough line on China's human rights abuses and regional expansionism in his first phone call with president Xi Jinping.

The Dow Jones Industrial Average finished marginally lower while the S&P 500 inched up 0.2 percent and the tech-heavy Nasdaq Composite rose 0.4 percent to reach fresh record closing highs.

European markets ended Thursday's session broadly higher as investors reacted to tame U.S. consumer inflation data and dovish comments from Fed Chair Jerome Powell.

The pan-European Stoxx 600 index gained half a percent. The German DAX climbed 0.8 percent and the U.K.'s FTSE 100 inched up 0.1 percent while France's CAC 40 index ended marginally lower.

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