Noor Trends News, Technical Analysis, Educational Tools and Recommendations
European stock markets opened Wednesday in narrow ranges as investors absorbed the implications of the recently concluded U.S.-China trade talks and braced for key inflation data out of the U.S.
As of 03:05 ET (07:05 GMT), Germany’s DAX edged down by 0.1%, while France’s CAC 40 gained 0.2%, and the FTSE 100 in the U.K. also advanced 0.2%.
U.S.-China Trade Framework: Optimism, But Few Details
After two days of intense negotiations in London, officials from Washington and Beijing announced a preliminary high-level framework aimed at easing long-standing tensions. The agreement proposes a mutual relaxation of export restrictions—notably, China’s rare earth exports in exchange for a softening of U.S. semiconductor curbs.
However, markets responded cautiously as specifics were lacking, and the deal remains subject to formal approval by U.S. President Donald Trump and Chinese President Xi Jinping. With prior truces failing to hold, investors remain wary of the potential for renewed trade conflict.
All Eyes on U.S. CPI, U.K. Spending Review
While Wednesday’s European economic calendar is light, U.K. markets are watching Chancellor Rachel Reeves, who is scheduled to deliver a Spending Review outlining fiscal allocations for all government departments.
However, the main event for global markets is the upcoming U.S. Consumer Price Index (CPI) release for May. With Trump-era tariffs still in effect and threatening to stoke inflation, today’s print is seen as pivotal.
Consensus forecasts:
- Headline CPI (MoM): +0.2%
- Core CPI (MoM): +0.3%
- Annual Headline: 2.5%
- Annual Core: 2.9%
Investors will be closely watching whether tariff-related price increases are already evident in goods inflation. While most of the impact is expected to appear in June figures, a strong upside surprise in May could influence the Federal Reserve’s policy stance. For now, markets widely expect the Fed to keep rates steady at next week’s meeting.
Inditex Misses Q1 Sales Expectations
Spanish fast-fashion giant Inditex (BME: ITX) is under the spotlight after missing Q1 sales forecasts, citing a sluggish start to the summer season. The company had previously described its performance as “very robust” but now refers to it as merely “solid.”
The sales miss comes amid growing concerns over stagflation risks and consumer pullback, especially in the U.S. where inflation and uncertainty over tariffs have started to weigh on discretionary spending.
Oil Prices Hold Ground After Trade Talks
Crude prices were steady early Wednesday as traders digested the trade developments and awaited the latest U.S. inventory data.
- Brent crude slipped 0.1% to $66.81 per barrel.
- WTI futures rose 0.1% to $64.99 per barrel.
Both benchmarks hit multi-month highs in the previous session, buoyed by optimism that a trade breakthrough could spur global demand for energy. Meanwhile, the EIA’s official stockpile report is expected later today, following API data showing a modest 370,000-barrel draw last week.
Outlook
Today’s session will likely remain subdued until the U.S. inflation data is released. A hotter-than-expected CPI could rattle bond markets, push the dollar higher, and weigh on equities and commodities. Conversely, a softer print would boost risk sentiment, especially in Europe’s export-heavy markets.
Meanwhile, political risk lingers, with both the trade truce and global growth prospects dependent on continued diplomatic progress and stable monetary policy.
