By Peter Nurse
Investing.com - European stock markets are seen opening lower Thursday, as investors fretted about the lack of progress in the talks over a new U.S. stimulus package while mounting coronavirus cases continued to weigh.
At 2:05 AM ET (0605 GMT), the DAX futures contract in Germany traded 0.4% lower, CAC 40 futures in France dropped 0.5% and the FTSE 100 futures contract in the U.K. fell 0.3%.
Optimism surrounding the potential for a new coronavirus relief package dissipated late Wednesday after President Donald Trump accused Democrats of being unwilling to come to an acceptable compromise over the size of the package.
While Trump had previously said he was willing to accept a large aid bill, it was clear that there was also deep opposition among Senate Republicans to such a hefty stimulus bill amid worries that it could hurt their November election prospects by adding to rapidly rising budget deficits.
That said, the two sides are expected to continue talking later Thursday, in what looks an increasingly unlikely hope that a deal can be reached before the Nov. 3 presidential election.
“Neither side wants to be portrayed as the villain in this drama, so both are appearing to be constructive, while simultaneously dragging their feet and counting down to the closing credits,” said ING analyst Robert Carnell, in a research note.
Meanwhile the coronavirus pandemic continues to play havoc. Spain became the first Western European country to exceed one million Covid-19 infections on Wednesday, doubling its tally in just six weeks, while in the U.S., the number of Covid-19 patients in the country’s hospitals hit 40,000 for the first time since August, according to a Reuters tally.
Back in Europe, earnings from the likes of Unilever (LON:ULVR), Michelin (PA:MICP), L’Oreal (PA:OREP) and STMicroelectronics (PA:STM) will be in focus Thursday, while a fall in the German GfK consumer climate index for November may weigh.
Oil prices weakened Thursday, adding to the heavy losses from the previous session, as official inventories add to worries about the outlook for fuel demand given the surge in Covid-19 cases.
The U.S. Energy Information Administration reported a draw of one million barrels for the week to Oct. 16, much smaller than the previous week’s 3.818 million-barrel draw. But it was more the build of 1.895 million barrels in gasoline supply, against the 1.829 million-barrel draw predicted, that spooked the market, as this suggested U.S. motorists are increasingly choosing to stay home.
U.S. crude futures traded 0.6% lower at $39.81 a barrel, after dropping 4% Wednesday, while the international benchmark Brent contract fell 0.4% to $41.55, after falling more than 3% the previous session.
Elsewhere, gold futures fell 0.7% to $1,916.45/oz, while EUR/USD traded 0.1% lower at 1.1852.