European stocks headed higher Tuesday, buoyed by gains on Wall Street overnight, and ahead of the release of the latest regional activity data.
At 03:05 ET (07:05 GMT), the DAX index in Germany gained 0.3%, the CAC 40 in France climbed 0.4% and the FTSE 100 in the U.K. rose 0.2%.
Powell speech in spotlight Global markets have retained a positive leaning, with the main Wall Street indices closing higher Monday, in the wake of the Federal Reserve’s interest rate cut last week, expecting further easing from the U.S. central bank’s two remaining meetings this year.
New Fed Governor Stephen Miran, selected by President Donald Trump for the role, called for large rate cuts on Monday, and futures imply around a 90% chance of a further quarter-point rate cut in October, and a 75% probability of an easing in December as well.
There are more Fed speakers due Tuesday, including Raphael Bostic and Michelle Bowman, but the highlight will be comments from Fed Chair Jerome Powell later in the session.
These comments will be crucial in determining investor sentiment in the near term.
Eurozone PMIs due Back in Europe, attention will be on the release of the flash PMIs for September later in the session, to see whether the eurozone economy continues to show resilience in the face of U.S. tariffs.
The eurozone releases are seen holding above the crucial 50.0 level that separates expansion and contraction, albeit not by much. The U.S. versions are also scheduled to be released later in the session, and are expected to show economic growth in gradual retreat.
Burberry recovery “overpriced” - Jefferies In the corporate sector, Burberry (LON:BRBY) will be in the spotlight after the British luxury fashion label rejoined London’s FTSE 100 on Monday, one year after exiting the top-tier stock index, and ahead of unveiling its latest collection at London Fashion Week.
However, Jefferies warned that hopes for a swift recovery at the fashion house are overpriced, reiterating its “underperform” rating, and seeing the potential for around 40% downside.
The brokerage said optimism around Burberry’s ability to rebuild profit margins is entering a critical test period.
The brokerage cautioned that “the emergence of broadly unchanged sales productivity in Q2, despite all the right commercial steps having been undertaken, would weaken the bullish narrative as H2 profit delivery demands a clear acceleration in momentum.”
Crude hit by oversupply worries Oil prices dropped Tuesday on continued oversupply concerns, after a preliminary agreement was reached between Iraq and Kurdish regional governments to restart an oil pipeline.
At 03:05 ET, Brent futures dropped 0.7% to $66.14 a barrel, and U.S. West Texas Intermediate crude futures fell 0.6% to $61.89 a barrel.
Both contracts are currently suffering a five-session losing streak.
Iraq’s federal and Kurdish regional governments reached a deal with oil firms to resume crude exports via Turkey on Monday, Reuters reported, potentially allowing exports of about 230,000 barrels per day to resume, having been suspended since March 2023.
