By Peter Nurse
Investing.com – European stock markets are expected to trade moderately on Wednesday, with weak Chinese data raising concerns about the global economic recovery.
At 2:05 am ET (0605 GMT), the DAX futures contract in Germany was trading flat, while CAC 40 futures in France fell 0.5% and the FTSE 100 futures contract in the UK fell. fell 0.6%.
A burst of economic data from China earlier Wednesday suggested that the world’s second-largest economy, and the main driver of regional growth, hit a slowdown in August thanks to the Covid-19 outbreaks and supply disruptions.
Retail sales grew 2.5% year-on-year, a sharp decline from July’s 8.5% growth and the slowest pace since August 2020, while industrial production increased by 5. 3% year-on-year, its weakest pace since July 2020.
The data dump continued in Europe on Wednesday, with UK consumer prices rising 3.2% year-on-year in August, up sharply from July’s 2.0%, increasing the pressure on the Bank of England to consider tightening its monetary stimulus.
There are also inflation figures for France and Italy for August due later Wednesday, as well as industrial production figures for the euro zone in July.
All of this follows Tuesday’s release of a weaker-than-expected rise in US inflation for August, creating more uncertainty over the timing of the Fed’s reduction in asset purchases.
Back in Europe, the retail sector is expected to be the center of attention on Wednesday, with companies like H&M (ST: HMb) and Inditex (MC: ITX) releasing quarterly results.
Crude prices strengthened on Wednesday, boosted by a larger-than-expected drop in US crude inventories, coupled with expectations of a substantial recovery in demand as countries bring the recent Covid-19 outbreak under control.
American Petroleum Institute crude oil supply data released Tuesday night showed a sizable 5.4 million barrels draw last week after Hurricane Ida shut down many refineries and production offshore drilling.
Investors are now awaiting crude oil supply data from the US Energy Information Administration, due later today, for confirmation.
Additionally, the International Energy Agency predicted on Tuesday that the deployment of the Covid-19 vaccine could lead to an economic rebound, leading to a surge in demand of 1.6 million barrels per day next month, with a growth continues until the end of the year.
As of 2:05 am ET, U.S. crude futures were trading up 0.7% to $ 70.98 a barrel, while the Brent contract was up 0.7% to $ 74.13.
Additionally, gold futures fell 0.2% to $ 1,803.95 / oz, while EUR / USD traded up 0.1% to 1.1807.
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