European Markets Heading For Stable Open After U.S. Inflation Report

LONDON – European stocks are expected to open around the flat line on Wednesday following a warmer than expected US inflation report released on Tuesday.

The London FTSE would open 2 more points to 7,125, the German DAX down 3 points to 15,782, the French CAC 40 up 7 points to 6,552 and the Italian FTSE MIB up 4 points to 25,042 , according to IG.

European markets are expected to open flat, following their Asia-Pacific counterparts overnight. The lackluster sentiment comes after the US Department of Labor said on Tuesday that in June inflation had risen to its fastest rate in nearly 13 years. Consumer prices rose 5.4% in June from the previous year, the largest monthly increase since August 2008.

US stock index futures were flat in overnight trading on Tuesday after major averages ended in the red amid inflation fears.

JPMorgan and Goldman Sachs kicked off the earnings season on Tuesday, with both banks beating both upper and lower estimates. Bank of America, Citigroup and Wells Fargo are expected to release their results before the market opens on Wednesday, as are BlackRock, PNC Financial and Delta.

There are no major profits in Europe on Wednesday, but Dunelm and PageGroup are issuing trade updates. On the data front, Eurozone industrial production data for May is released and the Netherlands, Sweden and the UK release June inflation data.