European Shares Seen Opening Up Ahead Of Fed Meeting

(RTTNews) - European stocks are likely to open higher on Tuesday as a two-day policy meeting of the U.S. Federal Reserve gets underway today amid expectations of a larger-than-expected rate cut.

The Fed's monetary policy announcement is due on Wednesday, with the U.S. central bank widely expected to deliver a quarter point interest-rate cut following recent data showing relatively subdued inflation and a weakening labor market.

According to CME Group's FedWatch Tool, there is a slim 3.6 percent chance of a half-point rate cut.

Traders will pay close attention to the Fed's accompanying statement, guidance from the dot plot and Fed Chair Jerome Powell's post-meeting comments for clues about the likelihood of further rate cuts.

Currently, analysts expect the Fed to lower rates by another 25 basis points at both its October and December meetings, but Powell may say that future rate cuts will depend on incoming economic data.

Ahead of the rate-setting meeting, the U.S. Senate has confirmed President Donald Trump's nominee Stephen Miran as a Federal Reserve Governor Monday night.

In another significant development, a U.S. appeals court has ruled Lisa Cook can remain on the Federal Reserve board while her lawsuit proceeds.

Trading later in the day may also be impacted by reaction to reports on U.S. sales, industrial production and import and export prices.

Closer home, U.K. unemployment data, Germany's ZEW economic sentiment survey results and Eurozone industrial production figures may garner some attention later in the day.

Asian markets were mostly higher after U.S. Treasury Secretary Scott Bessent said Washington reached a "framework" deal with China on the ownership of TikTok's American operations.

He also announced that the Trump administration would not impose additional tariffs on Chinese goods to halt China's purchases of Russian oil unless European countries hit China and India with steep duties of their own.

The dollar pulled back further in Asian trade after sliding in the prior session. Gold traded above $3,680 per ounce amid Fed rate cut hopes.

Oil prices were modestly higher after Ukraine hit Russia's 355,000 bpd Kirishi refinery with drones and the Israeli military launched a ground offensive on Monday to occupy Gaza City.

U.S. stocks rose overnight following positive comments from President Trump about trade talks between top U.S. and Chinese officials in Europe.

In a post on Truth Social, Trump said that the talks have "gone VERY WELL!" adding that a "deal was also reached on the sale of Chinese-owned social media TikTok.

Trump also said that he will be speaking with Chinese President Xi Jinping on Friday and described the relationship as "a very strong one."

In another development, China's antitrust regulator said an initial investigation showed Nvidia violated antimonopoly law.

The tech-heavy Nasdaq Composite and the S&P 500 gained 0.9 percent and half a percent, respectively to reach new record closing highs while the Dow inched up 0.1 percent.

European stocks ended near a three-week high on Monday ahead of key central bank decisions due this week, including those in the U.S., Britain, Japan and Canada.

The pan European STOXX 600 rose 0.4 percent. The German DAX edged up by 0.2 percent and France's CAC 40 jumped 0.9 percent while the U.K.'s FTSE ended marginally lower.