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Investing.com — European shares were broadly steady in early dealmaking on Tuesday, as investors mulled over the path forward for Federal Reserve monetary policy and digested fresh economic data out of Europe.
At 03:20 ET (08:20 GMT), the pan-European Stoxx 600 increased 0.04%, the DAX index in Germany traded 0.09% higher, and the CAC 40 in France rose by 0.19%. The FTSE 100 in the U.K. was an outlier, falling 0.47%.
The moves come after U.S. equities rallied in the prior session, with optimism growing that the Fed will slow its recent cycle of monetary tightening when policymakers meet next week. Some officials at the U.S. central bank, including Fed governor Christopher Waller, have backed a smaller 25-basis point rate hike despite lingering concerns over how long it will take for inflation in the world’s largest economy to fall back to the Fed’s 2% target.
Asian stocks added on to their recent rise, although trading remained thin with China and much of the region still closed for Lunar New Year celebrations.
Traders were also gauging preliminary PMI data from the Eurozone that showed that business activity unexpectedly grew in January. The S&P Global (NYSE:SPGI) composite PMI for the month came in at 50.2, surpassing the 50-point mark indicating expansion and above estimates of 49.8.
Meanwhile, consumer sentiment in Germany is on course to improve for a fourth straight month in February, according to a new survey from GfK institute, thanks mainly to a dip in energy prices.
In corporate news, timepiece maker Swatch Group (SIX:UHR) said it was hopeful about a recovery in its key Chinese market as the country reopens after the removal of long-standing COVID-19 restrictions, leading to a rally in the company’s shares.
Associated British Foods PLC (LON:ABF) shares dipped despite the retail group posting better-than-expected group revenue in the 16 weeks to January 7. Analysts at RBC Capital Markets suggested that margins at its key Primark unit will likely be hit by currency and inflation pressures.
Saga (LON:SAGA), the insurance and travel specialist focused on customers over 50, reported underlying pre-tax earnings in line with guidance during the August to January period following strong performance at its cruise business, providing a lift to shares.
Elsewhere, U.S. crude futures traded 0.15% lower at $81.50 a barrel, while the Brent contract decreased by 0.31% to $87.92 by 03:20 ET, with one of the major themes in the market being a search for signals of a rebound in Chinese demand.
Additionally, gold futures inched up 0.59% to $1,939.90/oz, while EUR/USD moved up 0.19% to 1.0889.
