By Peter Nurse
Investing.com - European stock markets are seen opening higher Wednesday, with investors keeping a wary eye on U.S. political developments as well as the progress of the coronavirus pandemic.
At 2:05 AM ET (0705 GMT), the DAX futures contract in Germany traded 0.3% higher, CAC 40 futures in France climbed 0.7% and the FTSE 100 futures contract in the U.K. rose 1%.
U.S. TV networks called one of the runoffs for Georgia's two seats in the U.S. Senate for Democrat Raphael Warnock, but the other race remained too close to call. The results are expected to be announced later Wednesday. These votes are seen as crucial in deciding whether President-elect Joe Biden enjoys full control of Congress or faces stiff opposition to his plans.
A win for the Democrat pair would likely result in more stimulus and tax hikes as well as greater corporate regulation. However, a win for either or both of the incumbent Republican candidates would mean a much more difficult path for Biden’s agenda.
Back in Europe, the European Medicines Agency is expected to give its assessment of Moderna’s coronavirus vaccine later Wednesday.
A new strain of the Covid-19 virus has forced the U.K. to enter another national lockdown earlier this week, while Germany on Tuesday extended its own lockdown until Jan. 31.
The U.K. has approved the use of both the Pfizer/BioNTech and AstraZeneca/Oxford University drugs, and its vaccination campaign is proceeding relatively quickly. However, the rest of Europe has been slower in implementing its program.
Turning to economic data, the major release will be the final European PMI number for December, while French inflation and consumer confidence data are also scheduled.
Oil prices gained Wednesday, boosted by Saudi Arabia’s surprise decision late Tuesday to make additional production cuts of 1 million barrels per day in February and March.
This move allowed OPEC+, a group of the world’s top producers, to hold output steady as a whole, as other countries could increase production levels to boost their national coffers even as demand struggles amid the ongoing Covid-19 pandemic.
U.S. crude oil inventories dropped by 1.7 million barrels in the week to Jan. 1, data from industry group the American Petroleum Institute showed on Tuesday. Official data is due later Wednesday.
U.S. crude futures traded 0.5% higher at $50.18 a barrel, while the international benchmark Brent contract rose 0.8% to $54.02. Both contracts climbed late Tuesday to their highest levels since February last year.
Elsewhere, gold futures fell 0.3% to $1,948.90/oz, while EUR/USD traded 0.2% higher at 1.2321.