Title: European Stock Futures Slip Lower; Powell Adds to Recession Concerns
Jun 23, 2022 01:59AM ET
European stock markets are expected to open lower on Thursday as risk sentiment is volatile on growing concerns that aggressive interest rate hikes by the Federal Reserve will lead to a global recession.
At 02:00 GMT, the DAX futures contract in Germany was trading 0.3% lower; the CAC 40 futures contract in France was down 0.3%; and the FTSE 100 futures contract in the UK was down 0.3%.
European equity indices received little transmission from Asia, and U.S. stock futures were also lower after the first day of U.S. Federal Reserve Chairman Jerome Powell's two-day testimony to Congress.
Powell said the Fed is "firmly committed" to lowering inflation, adding that a recession is "certainly possible." This is not our expected outcome at all. "
Adding to the concerns in Europe are the ongoing war in Ukraine, related sanctions on Russian crude and a sharp rise in gas prices as Moscow cuts its supplies.
Meanwhile, investors will be scrutinizing the preliminary June purchasing managers' index data for services and manufacturing in the Eurozone to get a sense of how the region is coping with difficult economic conditions.
In addition, U.S. President Joe Biden called on Congress to pass a three-month suspension of the federal gasoline tax to help fight record pump prices.
Data from the American Petroleum Institute on US crude supply on Wednesday showed an increase of 5.6 million barrels for the week ended June 17.
The U.S. Energy Information Administration's weekly oil data will be delayed until at least next week because of systems problems.
As of 02:00 GMT, U.S. crude futures were trading 1.4% lower at $104.69 a barrel, while the Brent contract was down 1.2% at $110.38. Both benchmarks fell about 3% in the previous session, reaching their lowest levels since mid-May.
In addition, gold futures fell 0.1% to $1,836.50 an ounce and the euro/dollar rose to $1.0566.