European stocks are expected to open provisionally higher on Tuesday as markets in the region continue to monitor the latest developments after the inconclusive federal election in Germany.
The UK FTSE would open 8 more points to 7,071, the German DAX 21 more points to 15,603, the French CAC 7 points to 6,654 and the Italian FTSE MIB 30 more points to 25,824, according to IG.
European markets are expected to continue to assess the fallout from Germany’s elections on Tuesday after Sunday’s vote created more uncertainty for the country.
The center-left Social Democratic Party (SPD) won the largest share of the vote with 25.7% by a narrow margin, Angela Merkel’s right-wing bloc of the Christian Democratic Union and the Union Christian-social obtaining 24.1% of the vote.
Coalition negotiations between the main parties and two smaller counterparts, the Greens and the Free Democrats, are expected to take weeks, if not months. The SPD previously rejected the option of forming another “grand coalition” with the CDU / CSU. Both parties demanded a mandate to govern after the result.
Meanwhile, US equity futures were stable in trading overnight, following rising bond yields that weighed on pockets of market growth.
Stocks in Asia-Pacific fell largely in trading on Tuesday, as various companies lowered forecasts for China’s GDP. Goldman Sachs cut its forecast for Chinese GDP growth to 7.8% on Tuesday, from 8.2% previously forecast. Nomura also expects China’s GDP to grow 7.7% this year, up from a previous forecast of 8.2%.
Profits come from Lego on Tuesday, while data released includes German GfK consumer sentiment data and French consumer confidence figures. Other events in the spotlight include speech by ECB President Christine Lagarde at the ECB Central Bank Forum at 1 p.m. London time and OPEC’s World Oil Outlook which is expected on Tuesday. in the early afternoon.
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– CNBC’s Eustance Huang and Maggie Fitzgerald contributed reporting for this story.