European Shares Set For Flat Open

European stocks may open flat to slightly higher on Tuesday as investors pin hopes on U.S. stimulus and await U.S. bank results with JPMorgan and Citigroup kicking off the third-quarter earnings season later today.

Goldman Sachs, Bank of America, Wells Fargo and Morgan Stanley will unveil their quarterly earnings later this week.

White House Press Secretary Kayleigh McEnany said on Monday she believes U.S. Senate Republicans will eventually get on board with what President Trump wants in coronavirus relief legislation.

U.S.-China tensions also remain on investors’ radar amid reports that the Trump administration plans to sell three advanced weapons systems to Taiwan, which is seen by China as a breakaway province.

On the Covid-19 front, Italy is considering a ban on private parties in response to a recent spike in new coronavirus cases, while French authorities are expected to impose new lockdowns in a bid to contain another surge in the virus cases.

The Czech Republic announced that it would close bars and shift most schools to distance learning.

British Prime Minister Boris Johnson on Monday announced a new three-tire system of restrictions splitting England into medium risk, high risk and very high risk areas.

Johnson & Johnson said it had temporarily halted its Covid-19 vaccine trial due to an unexplained illness in a participant.

Asian markets are trading mixed with Hong Kong suspending trading due to a typhoon.

Gold inched lower as the dollar rose slightly despite softer Treasury yields. Oil prices held steady on fears of oversupply and amid concerns about resurgent Covid-19 infections in the U.S. Midwest and Europe.

China’s exports rose 9.9 percent to $239.7 billion in September, marking a fourth straight monthly gain, while imports rose by 13.2 percent to $202.7 billion after weakening in the previous two months, official data showed earlier today.

Labor market statistics from the U.K. and economic confidence data from Germany are due later in the session, headlining a light day for the European economic news.

The virtual annual meetings of the IMF and the World Bank group will begin later today and continue till October 18.

U.S. stocks rose sharply overnight as investors became more confident of a larger stimulus deal down the road.

The Dow Jones Industrial Average gained 0.9 percent and the S&P 500 rallied 1.6 percent, while the tech-heavy Nasdaq Composite jumped as much as 2.6 percent ahead of Apple’s new iPhone launch event.

European markets rose on Monday amid optimism about a fiscal stimulus in the U.S. The pan European Stoxx 600 moved up 0.7 percent.

The German DAX and France’s CAC 40 index both rose about 0.7 percent, while the U.K.’s FTSE 100 slid 0.3 percent.

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