Wall Street is expected to open slightly higher on Tuesday ahead of a key economic indicator in the United States, while European stocks are retreating mid-session, notably weighed down by the luxury sector.
Futures on New York indices indicate a stable opening for the Dow Jones (-0.01%), a 0.13% rise for the Standard & Poor’s 500, and a 0.20% increase for the Nasdaq.
In Paris, the CAC 40 is down 0.78% at 7,573.12 points around 11:05 GMT. In Frankfurt, the DAX is dropping by 0.47%, and in London, the FTSE is down 0.31%.
The pan-European FTSEurofirst 300 index is down 0.50%, the EuroStoxx 50 of the eurozone is down 0.60%, and the Stoxx 600 is down 0.44%.
In the United States, investors are trying to assess the prospect of Donald Trump winning the November presidential election following an assassination attempt that boosted his popularity, allowing him to make a triumphant entry at the Republican convention on Monday with Ohio Senator J.D. Vance as his running mate. According to some market operators, Trump’s return to the White House could result in an expansionist trade policy and more relaxed regulations.
However, a new presidency under Donald Trump could also revive the specter of a trade war.
“The idea that Trump could win a second term is interpreted as negative for European stocks, primarily due to the protectionist policies Trump might implement,” wrote Fiona Cincotta, a market analyst at City Index.
Aside from the economic implications of a Trump victory, investors are also keeping an eye on macroeconomic statistics, notably the monthly retail sales in the United States. This indicator, to be released at 12:30 GMT, will help assess how consumers are reacting to inflation, with a Federal Reserve rate cut expected in September.
Stocks to Watch on Wall Street
Stocks related to Donald Trump, such as Trump Media & Technology Group (-8.5%) and Rumble (-1.4%), are falling in pre-market trading, hit by profit-taking after significant gains on Monday.
Tesla is up 1.6% in pre-market trading after news that the company’s CEO, Elon Musk, plans to commit about $45 million per month to a new pro-Trump super PAC.
European Stocks
Hugo Boss is plummeting by 8.25% after lowering its sales forecast for the year due to weakening global demand, notably in China and the UK. The European luxury sector is down 0.95%, with Kering (-3.0%), Burberry (-3.60%), and LVMH (-1.19%) also in the red.
Scor is down 24.48% after warning that its life and health (L&H) segment is expected to post a loss in the second quarter. The European insurance sector is down 1.41%.
Ocado is surging by 12.19% as the British company raised its annual forecasts, citing improved profitability in its warehouse technology business.
Bonds
The yield on the 10-year U.S. Treasury note is down about five basis points to 4.1808%, as traders now expect a rate cut by September, with an 86% probability of a 25-basis-point reduction, according to CME’s FedWatch tool.
The yield on the 10-year German Bund is down 3.2 basis points to 2.432%, the second drop in two days, ahead of Thursday’s European Central Bank (ECB) policy meeting.
Currencies
The dollar is up slightly on Tuesday, by 0.02%, against a basket of major currencies after hitting a one-month low of 104.6 points on Monday.
The euro is at $1.0898 (+0.04%), and the British pound is at $1.2968 (+0.02%).
Oil
Oil prices are falling on Tuesday due to concerns about a slowdown in the Chinese economy, with GDP growth coming in below expectations in the second quarter.
Brent crude is down 0.92% at $84.07 per barrel, and U.S. light crude (West Texas Intermediate, WTI) is down 1.01% at $81.08 per barrel.