European Shares Seen Tad Higher As Investors Await Fed Minutes

(RTTNews) - European stocks may open slightly higher on Wednesday, as investors await the release of minutes from the Federal Reserve's November meeting for additional clues about the direction of interest rates.

Along with the Fed minutes, reports on durable goods orders and new home sales may also attract attention ahead of a U.S. holiday on Thursday for Thanksgiving.

According to the CME's FedWatch tool, there is a 75.8 percent probability that the U.S. central bank will hike rates by 50 basis points at its next policy meeting scheduled for December 13-14.

But Kansas City Fed President Esther George warned on Tuesday that interest rates could stay higher for longer in order to successfully moderate consumer demand and bring down inflation.

The U.S. dollar edged up, while oil and gold traded slightly lower. Asian markets traded mixed as China COVID concerns lingered, and New Zealand delivered its biggest rate hike ever. Japanese markets were closed for a national holiday.

In its Economic Outlook released Tuesday, the Organization for Economic Co-operation and Development (OECD) has warned of a significant growth slowdown for the world economy in 2023.

U.S. stocks rallied overnight, as upbeat earnings from the likes of Best Buy and Abercrombie & Fitch lifted retailers ahead of the holiday shopping season.

The S&P 500 climbed 1.4 percent to close above 4,000 for the first time since September and the Dow added 1.2 percent to reach a three-month closing high, while the tech-heavy Nasdaq Composite surged 1.4 percent.

European stocks hit three-month closing highs on Tuesday despite mixed comments on interest-rate hikes from Fed and ECB policymakers, and renewed concerns over China's tightening of COVID restrictions.

The pan European STOXX 600 gained 0.7 percent. The German DAX edged up 0.3 percent, France's CAC 40 index rose 0.4 percent and the U.K.'s FTSE 100 climbed 1 percent.