European markets set for muted open with earnings, economic data and bond yields in focus
- Investor focus will be attuned to a slew of economic data, most notably February's Markit flash PMI (purchasing managers' index) readings out of France, Germany and the euro zone as a whole.
- Corporate earnings will remain a key driver of individual share price action Friday, with Danone, Hermes, Renault, Allianz and Swiss Re among the blue chip companies reporting before the bell.
European markets are heading for a cautiously higher open on Friday as investors monitor rising bond yields, corporate earnings and a batch of key economic data out of the euro zone.
Britain's FTSE 100 is seen inching 2 points higher to 6,619, Germany's DAX is set to climb around 60 points to 13,947 and France's CAC 40 is expected to gain around 15 points to open at 5,743, according to IG data.
European stocks are set to receive a weak handover from Asia-Pacific, where markets broadly declined during Friday's trade, following Wall Street's losses on Thursday as rising U.S. Treasury yields and concerns about higher inflation caused a recent rally in global markets to seemingly fizzle out.
The yield on the benchmark 10-year U.S. Treasury note was back above 1.3% early on Friday morning. Yields tend to rise with inflation expectations as bond investors start to believe central banks will take their foot off the gas and reduce their asset purchases. Higher yields can also mean more debt servicing for major firms, which tends to knock stock markets as traders reassess the environment for investing.
Futures tied to major U.S. indexes were slightly lower in overnight trading. U.S. Treasury Secretary Janet Yellen told CNBC on Thursday that a large stimulus package is still necessary to get the economy firing on all cylinders again.
Back in Europe, U.K. Prime Minister Boris Johnson will chair a virtual meeting of leaders of the G-7 major economies on Friday, and is expected to outline an ambition to cut the time to develop new vaccines by two-thirds to 100 days.
Meanwhile, Germany's regulator on Thursday declared that the AstraZeneca-University of Oxford vaccine was "highly effective" and said negative side-effects are short-lived.
Corporate earnings will remain a key driver of individual share price action Friday, with Danone, Hermes, Renault, Allianz and Swiss Re among the blue chip companies reporting before the bell.
Investor focus will also be attuned to a slew of economic data, most notably February's closely-watched Markit flash PMI (purchasing managers' index) readings out of France, Germany and the euro zone as a whole.
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