European markets opened lower on Tuesday, with central banks taking center stage this week.
The pan-European Stoxx 600 opened down 0.4%, with all sectors and all major European exchanges falling.
The focus for global markets this week is the Federal Reserve’s final two-day policy meeting of the year. The meeting will begin on Tuesday, with the central bank due to make a monetary policy decision on December 18.
Traders reportedly see a 95% chance of a 25 basis point rate cut on Wednesday CME Group’s FedWatch Tool. Investors will also look to Chairman Powell’s post-meeting press conference for clues on future policy moves.
The Bank of England meets on Thursday and so far markets are pricing in a slim chance of an eventual rate cut this year.
In other news, Chancellor Olaf Schulz’s invitation failed in a vote of confidence in the German parliament on Monday, paving the way for snap elections on February 23. election. The move follows the collapse of his coalition government last month.
Overnight, Asia-Pacific markets were mixed on Tuesday, with U.S. stock index futures slightly lower on Monday night.
European data releases on Tuesday will include UK unemployment data and Germany’s Ifo business sentiment and economic sentiment index. There are currently no major financial reports to be released.
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