European stocks are set to open in a mixed territory on Thursday, with investors in the UK focusing on the upcoming decision by the Bank of England (BoE) regarding its policy rate.
According to IG, the UK’s FTSE index is expected to open 16 points higher at 8,212, while Germany’s DAX could see a gain of 21 points, opening at 18,087. France’s CAC 40 is forecasted to open up 3 points at 7,568, and Italy’s FTSE MIB might start the day 10 points higher at 33,192.
UK traders are eagerly awaiting the Bank of England’s rate decision, although analysts widely anticipate the central bank to maintain rates steady at 5.25%, marking a 16-year high. Most economists polled by Reuters foresee a potential rate cut in August, following the country’s July 4 election.
Recent data released on Wednesday indicated that UK inflation rose to 2.0% annually in May, meeting the BoE’s inflation target. This stable inflation rate may influence the BoE’s decision-making process going forward.
Simultaneously, the Swiss National Bank (SNB) is also scheduled to announce its monetary policy decision on Thursday. A significant majority of economists polled by Reuters expect the SNB to implement a 25-basis-point cut, lowering the policy rate to 1.25%.
Investors will also be monitoring earnings reports from companies like Boohoo Group and DS Smith. Additionally, flash consumer confidence figures for June from the euro zone are slated for release, providing further insights into economic sentiment within the region.
In overnight trading, Asia-Pacific markets exhibited mixed performances, with indices mostly lower as China opted to maintain its one- and five-year loan prime rates unchanged. Meanwhile, S&P 500 futures showed minimal movement on Wednesday, indicating a cautious stance among investors as they assess the potential for the benchmark index to extend its recent record highs.
Looking ahead, market participants will be closely watching economic indicators and corporate earnings releases to gauge the trajectory of global markets amid ongoing uncertainties and evolving central bank policies.