European Stock Markets Start Strong as Traders Watch U.S. Federal Reserve Meeting
LONDON — European stock markets kicked off the week positively, with traders eager for the upcoming U.S. Federal Reserve meeting, encouraging earnings reports, and signs of improving U.S.-China relations.
The pan-European Stocks 600 index was up 0.1% around 8:06 a.m. ET, while Britain’s FTSE index and France’s CAC40 hovered near steady levels right after the opening bell. Additionally, Germany’s index and Italy’s FTSE MIB saw increases of 0.4% and 0.5%, respectively.
Last week’s local markets ended on a high note as investors reacted to recent U.S. inflation data, which, amid a government shutdown, was notably the only federal figure released. Annual U.S. inflation recorded a lower-than-anticipated 3% in September, leading to a surge in U.S. stocks based on expectations that the Federal Reserve might lower interest rates in its upcoming meeting.
Current forecasts suggest a 96% chance of a 25 basis point rate reduction this week, as mentioned in reports. Additionally, geopolitical factors concerning trade remain in focus, particularly with hopes that the U.S. and China can resolve their ongoing trade conflicts.
U.S. President Donald Trump is set to meet with Chinese President Xi Jinping in South Korea on Thursday to address these trade tensions. This meeting could, perhaps, reassure investors and provide more clarity. As Trump continues his tour of Asia, the two leaders will connect on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit.
U.S. Treasury Secretary Scott Bessent recently described the discussions between Trump and Xi as “constructive, far-reaching, and thorough,” implying potential progress could be made.
On Monday, European companies like Galp Energia and Deutsche Börse announced their earnings, coinciding with the release of Germany’s ifo Business Environment Survey.
Moreover, CNBC will attend the Future Investment Initiative (FII) Forum in Riyadh this week. This event is expected to attract 20 heads of state and more than 600 speakers, including many top bankers, consultants, and technology leaders such as JPMorgan CEO Jamie Dimon and Goldman Sachs’ David Solomon.
