European Shares Seen Opening Mixed As Focus Shifts To Fed, Tariffs

(RTTNews) - European stocks may open broadly higher on Thursday, though futures data suggest a negative start for London markets.

With geopolitical tensions receding, focus has shifted to the upcoming U.S. trade tariff deadline of July 9.

Defense stocks could be in focus today after NATO members agreed on a higher defense spending target following pressure from U.S. President Donald Trump.

Leaders from the 32-memer bloc agreed to boost spending to 5 percent of GDP, but Spain, Belgium and Slovakia said they will struggle to meet target.

Tech shares may also see increased activity after memory chip maker Micron Technology reported second quarter results and guidance that topped consensus.

In economic news, trading later in the day may be impacted by reaction to German GfK consumer confidence figures as well as U.S. reports on weekly jobless claims, durable goods orders and pending home sales.

The U.S. GDP report due later in the day and the Price Consumption Expenditure data coming up on Friday may provide additional clues on the Fed's rate trajectory.

Investors are currently anticipating 64 basis points worth of Fed rate cuts by the end of this year, with the next rate cut anticipated only in September.

Asian markets were subdued this morning, though Japan's Nikkei surged nearly 1.5 percent, led by tech shares after Nvidia share price surged to a record high overnight, pushing the chipmaker back to the top spot on the list of the world's most valuable companies.

The dollar fell, gold held steady and short-term U.S. Treasuries rallied as concerns mounted over the U.S. Federal Reserve's independence.

During a press conference at the Hague, U.S. President Trump said he has three or four people in mind to succeed Federal Reserve Chair Jerome Powell when his term expires next year.

"I know within three or four people. I mean he goes out pretty soon, fortunately, because I think he's terrible," said Trump of Fed Chair Jerome Powell whose terms ends in May next year.

Oil held onto overnight gains following its biggest two-day decline since 2022 as data showed U.S. crude oil and fuel inventories fell last week and Trump hinted at potentially easing Iran oil sanctions to aid the nation's reconstruction.

Asked if he was easing sanctions on Iran, Trump said on Wednesday that the U.S. has not given up its maximum pressure on the country, but they need money to put the country back into shape.

Meanwhile, the Bloomberg reported that Russia is open to another output hike at the next OPEC+ meeting if the alliance deems such an increase to be necessary.

U.S. stocks ended narrowly mixed overnight due to profit taking after a two-day rally and amid disappointing profit forecasts from the likes of FedEx and General Mills.

Investors also pored over a second day of congressional testimony from Fed Chair Powell, who reiterated cautious stance on rushing to cut interest rates.

The tech-heavy Nasdaq-Composite edged up by 0.3 percent to reach a fresh four-month closing high, while the S&P 500 finished marginally lower and the narrower Dow eased 0.3 percent.

European shares ended Wednesday's session lower as fighting in Gaza raged and focus shifted to the looming U.S. tariff pause deadline.

The pan-European STOXX 600 gave up 0.7 percent. The German DAX declined 0.6 percent, France's CAC 40 shed 0.8 percent and the U.K.'s FTSE 100 dipped half a percent.