European Shares Seen Opening Flat In Cautious Trade

european market 021219 20jul21 lt

European stocks may open on a flat note Tuesday, with underlying sentiment likely to remain cautious amid escalating worries about spreading coronavirus variants.

Geopolitical worries also remain on investors' radar after the U.S., the U.K. and their allies accused three Chinese state security officials of coordinating a vast hacking campaign to steal sensitive and secret information from government entities, universities and corporations around the world.

Asian markets faltered while the dollar held gains as ten-year yields climbed back above 1.2 percent amid signs the impact of global commodity inflation was gradually broadening.

U.S. President Joe Biden on Monday said an increase in inflation was expected to be temporary and he expects the Federal Reserve to take action if needed.

Earlier today, the People's Bank of China kept its benchmark lending rate for corporate and household loans unchanged at its monthly fixing.

Oil steadied in Asian trade after plunging around 7 percent in the previous session on news of an OPEC+ deal to boost supply into 2022. Bitcoin fell below the closely watched $30,000 level.

It's a relatively quiet day on the U.S. and European economic calendar. After the U.S. closing bell, International Business Machines Corp. reported its biggest increase in revenue in three years on the back of strong cloud-computing demand.

U.S. stocks tumbled overnight to reach their lowest closing levels in almost a month as new COVID-19 cases continued to surge, oil prices plummeted on oversupply fears and data showed an unexpected dip in homebuilder confidence.

The Dow plunged 2.1 percent, the tech-heavy Nasdaq Composite lost 1.1 percent and the S&P 500 shed 1.6 percent.

European stocks fell sharply on Monday amid mounting concerns about the rapidly surging delta variant of the coronavirus in several countries across Europe Asia and the U.S.

The pan European Stoxx declined 2.3 percent. The German DAX lost 2.6 percent, France's CAC 40 index slumped 2.5 percent and the U.K.'s FTSE 100 gave up 2.3 percent.

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