European Shares To Open On Firm Note Ahead Of US Inflation Data

(RTTNews) - European stocks are likely to open on a positive note in cautious trade on Wednesday as investors await progress on U.S. debt ceiling talks and key U.S. inflation data.

U.S. President Joe Biden and top lawmakers failed to break a deadlock on the debt ceiling crisis but agreed to meet again this week to avert the looming risk of an unprecedented government default.

Asian markets were broadly lower as investors awaited U.S. inflation data for more clarity on the outlook for interest rates.

The Labour Department's consumer price inflation for April will be out later in the day while producer price inflation data is due to be released on Thursday.

The Bank of England meets on Thursday, with markets expecting another 25-basis point rate hike after stronger-than-forecast first-quarter data for growth, wages and inflation.

The dollar traded mixed in Asian session, while oil and gold prices were moving lower.

In a possible sign of weakening demand, the American Petroleum Institute reported on Tuesday that U.S. crude inventories rose by about 3.6 million barrels in the week ended May 5.

U.S. stocks fell overnight amid the ongoing stalemate in Washington over raising the U.S. debt limit and ahead of key inflation data.

The Dow slipped 0.2 percent, the S&P 500 eased half a percent and the tech-heavy Nasdaq Composite shed 0.6 percent.

European stocks also closed lower on Tuesday after a slew of weak corporate earnings and disappointing Chinese trade data.

The pan European STOXX 600 fell 0.3 percent. The German DAX finished marginally higher, while France's CAC 40 gave up 0.6 percent and the U.K.'s FTSE 100 slipped 0.2 percent.