By Peter Nurse
Investing.com - European stock markets edged higher Tuesday helped by M&A talk, but investors remain cautious ahead of the release of U.S. inflation data that will offer a crucial guide to the Federal Reserve’s interest rate outlook.
Helping the tone Tuesday was a report from Sky News that French industrial group Schneider Electric (EPA: SCHN ) is nearing a deal to take full control of British software maker AVEVA (LON: AVV ) for about 3.5 billion pounds ($4.1 billion). Aveva stock rose 3.2% as a result, while Schneider climbed 1%.
UBS (SIX: UBSG ) stock also rose 1.5% after the Swiss banking group announced plans to increase its dividend and anticipated its share repurchases will exceed $5 billion for 2022.
On the flip side, Ocado (LON: OCDO ) stock slumped over 12% and Marks and Spencer (LON: MKS ) dropped around 2% after Ocado Retail, a joint venture between the two companies, warned that it expects to report a decrease in full-year sales, as shoppers rein in spending in response to surging prices.
The U.K. unemployment rate fell to its lowest since 1974 at 3.6% in the three months to July, data showed earlier Tuesday, as more people left the labor market, but the number of people in employment grew by only 40,000 in the May-July period.
German consumer prices climbed to 7.9% annually in August, from 7.5%, which is likely to point to an ugly ZEW economic sentiment survey later in the session. However, that is still likely to be overshadowed by the release of the U.S. data, due at 08:30 ET (12:30 GMT), as the U.S. CPI numbers will frame the Fed's policy meeting next week and set the tone for weeks to come.
The markets are currently factoring in roughly athat the Federal Reserve lifts its benchmark interest rate by 75 basis points at next week's policy meeting.
The Organization of Petroleum Exporting Countries and its allies agreed last week to reduce crude production, and traders will look to the report, due later in the session, for more cues on global demand.
Crude hit the lowest level since January last week on concerns over global growth, including in top importer China, where renewed COVID-19 restrictions are impacting activity.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.