European stock markets are poised for a muted start on Thursday, reflecting concerns over the sustained elevation of global interest rates.
Asian markets experienced a general decline, attributed to ongoing worries about inflation and rising interest rates.
In commodities, gold prices fell for the second consecutive session while the U.S. dollar appreciated, supported by elevated U.S. Treasury yields following a lackluster debt auction the day before. Meanwhile, oil prices continued their downward trend as investors grew increasingly concerned about the adverse effects of high borrowing costs on economic growth and energy demand.
In geopolitical news, an Israeli official has suggested that the conflict in Gaza could extend until the end of the year, as efforts continue to dismantle the Palestinian group's infrastructure.
Economic data in the Eurozone, particularly unemployment and economic sentiment figures, are expected to attract investor interest later today. In the U.S., reports on weekly jobless claims, first-quarter GDP, and pending home sales will be watched closely ahead of key inflation data due on Friday. The first revision of Q1 GDP is anticipated to show lower growth than initially reported, while the Federal Reserve's preferred inflation measure—the personal consumption expenditures index—is expected to remain consistent with March's figures.
In U.S. markets, stocks closed lower overnight as bond yields surged for a second day amid uncertainty regarding the Federal Reserve's interest-rate strategy. The yield on the benchmark ten-year note reached its highest in nearly a month following tepid demand for a $44 billion auction of seven-year Treasury notes. The Dow declined by 1.1%, reaching its lowest closing level in almost a month, the S&P 500 fell by 0.7%, and the tech-heavy Nasdaq Composite decreased by 0.6%.
European stocks also declined for the second consecutive session on Wednesday, following a report that German inflation slightly surpassed forecasts, rising to 2.8% in May. The pan-European STOXX 600 fell by 1.1%, Germany's DAX dropped by 1.1%, France's CAC 40 slid by 1.5%, and the U.K.'s FTSE 100 decreased by 0.9%.
