By Peter Nurse
Investing.com - European stock markets are set to open in a mixed fashion Friday, helped by more gains on Wall Street overnight but with investors wary about the state of the global economic recovery ahead of the release of key purchasing managers economic indicators.
At 2:10 AM ET (0610 GMT), the DAX futures contract in Germany traded 0.1% higher, the FTSE 100 futures contract in the U.K. fell 0.1%, while CAC 40 futures in France rose 0.1%.
U.S. stocks closed higher on Wall Street Thursday, boosted by gains in giant technology companies despite renewed concerns that a recovery from the pandemic-induced recession will take a prolonged period.
This follows news that applications for U.S. unemployment benefits unexpectedly increased, while the Philadelphia Fed reported a disappointing reading for its manufacturing index.
Additionally, “the minutes of the European Central Bank's July meeting [released Thursday] can be summarised with one word: ‘uncertainty’,” said analyst Carsten Brzeski at ING, in a research note.
“Uncertainty about the economic outlook and the pandemic is keeping the central bank on high alert.”
With this in mind, investors will likely carefully study the release of the European Purchasing Managers' Indexes, later Friday, for clues as to the health of the region’s economy. Eurozone business activity returned to modest growth in July, but forecasts suggest this growth may have stagnated in August as some areas experienced the reemergence of the coronavirus.
U.K. retail sales showed a sharp reduction in growth in July, climbing 3.6% compared with a jump of 13.9% in June, but this was still better than the 2% widely expected.
Oil prices edged higher Friday, helped by efforts by the major producing states to curtail supply to the market amid concerns about the recovery of demand.
An internal report by the Organization of the Petroleum Exporting Countries and allies indicated that some members of the group, known as OPEC+, would need to slash output by 2.31 million barrels per day to make up for producing more that they had committed to, Reuters reported.
That said, the report also flagged demand risks, showing OPEC+ expects oil demand in 2020 to fall by 9.1 million barrels per day, 100,000 bpd more than in its previous forecast, and by 11.2 million barrels if a Covid-19 second wave occurs globally in the second half of the year.
U.S. crude futures traded 0.1% higher at $42.88 a barrel, while the international benchmark Brent contract rose 0.3% to $45.02.
Elsewhere, gold futures rose 0.3% to $1,952.30/oz. EUR/USD traded 0.2% higher at 1.1877.