European Shares Seen Mostly Higher In Cautious Trade

(RTTNews) - European stocks are seen opening higher on Thursday, even as technology stocks may come under selling pressure on concerns that a Democratic-led U.S. Congress could push for tighter regulation of AI development and data center construction, which could lead to a slowdown in capex.

Broader markets may extend gains from the previous session as global bond yields eased and Brent crude prices plummeted to $94 a barrel on hopes that the U.S.-Iran war could end soon.

Brent crude futures were down more than 1 percent at $93.56 a barrel in Asian trade, extending a decline of nearly 9 percent in the previous session, as Democrats' sweeping victory in the U.S. midterm elections along with diplomatic signals from Washington and Tehran helped strip the risk premium out of crude.

Global bond yields also eased, with the two-year U.S. Treasury yield falling to a two-month low of 4.546 percent and the 10-year Treasury yield dropping to 4.888 percent, as investors mull what a divided government will mean for the war with Iran, President Trump's policy agenda and the AI trade.

Asian markets were mixed as regional chipmaking shares slumped on expectations of tighter tech oversight.

Gold prices were up nearly 2 percent at $4,136 an ounce in Asian trade after witnessing the biggest jump since August on Wednesday as the dollar and Treasury yields slipped.

Overnight, U.S. stocks soared, Treasury yields dropped across the curve and oil prices nosedived nearly 9 percent as a commanding "blue wave" in the midterms eased political uncertainty and stoked hopes that the war with Iran could end soon.

President Donald Trump said he was "absolutely willing" to accept the results of the midterm elections and work with Democrats to address political issues.

As traders rethink Trump's remaining policy agenda and the political trajectory into 2028, analysts said a divided government and a degree of gridlock to the economic backdrop is favorable for equity prices.

In economic news, payroll processor ADP reported that U.S. companies added more jobs in October than expected. A separate report showed the U.S. service sector expanded in October at the slowest pace in three months amid continuing cost pressures.

The Dow soared 3 percent to reach a two-month closing high and record its biggest single-day gain since April 9 last year, when President Trump announced the first pause on reciprocal tariffs.

The S&P 500 surged 1.6 percent and the tech-heavy Nasdaq Composite climbed 1.4 percent.

European stocks rose sharply on Wednesday, with investor sentiment boosted by stronger-than-expected corporate earnings and easing concerns about energy costs after the midterm election blowout delivered a new era in Washington.

The pan-European STOXX 600 advanced 1.8 percent. The German DAX rallied 2.2 percent, France's CAC 40 jumped 2 percent and the U.K.'s FTSE 100 climbed 1.8 percent.