European Shares Set For Steady Opening Ahead Of US Inflation Data

(RTTNews) - European stocks may open on a steady note Wednesday, with trading later in the day likely to be driven by U.S. consumer inflation data.

The annual rate of growth in consumer prices is expected to slow to 3.1 percent in June from 4.0 percent in May, while the annual rate of core consumer price growth is expected to slip to 5.0 percent in June from 5.3 percent in May.

The consumer price data is likely to have a significant impact on the outlook for interest rates ahead of the next Federal Reserve meeting later this month.

Currently, traders expect the Fed to raise interest rates by 25 basis points at its July 25-26 meeting, with another increase possible by year-end.

Gold edged higher amidst a fall in the dollar index and U.S. bond yields.

Oil extended overnight gains, though overall gains remained capped after industry data showed a bigger-than-expected build in U.S. crude stockpiles.

The Bank of England publishes results of the annual stress test of the U.K. banking system alongside its Financial Stability Report later in the day.

U.S. stocks advanced overnight as Beijing extended its policy support to the ailing property sector and bond yields remained capped ahead of key inflation reports and bank earnings this week.

The Dow gained 0.9 percent, the tech-heavy Nasdaq Composite surged 0.6 percent and the S&P 500 added 0.7 percent.

European stocks ended on a firm note Tuesday after comments from a trio of Fed officials suggested that the U.S. central bank was nearing the end of its monetary policy tightening cycle.

The pan European STOXX 600 rose 0.7 percent to extend gains for a third straight session.

The German DAX climbed 0.8 percent, France's CAC 40 rallied 1.1 percent and the U.K.'s FTSE 100 edged up 0.1 percent.