European markets set to nudge higher after U.S. GDP beat expectations

Jenni Reid

European markets looked set to open slightly higher Friday, after U.S. economic data came in stronger than expected and with a slew of rate hike decisions due next week.

Investor sentiment appeared slightly brighter despite a mixed performance from corporate earnings released this week, and with the start of year rally having stuttered.

Friday will see the release of U.S. data on core inflation, personal income and spending and pending home sales. The U.S. economy expanded by 2.9% year on year during the fourth quarter, beating expectations, though recession fears remain.

In Europe, data is due on French consumer confidence and euro zone household loans. Earlier in the week, the German government as well as research group Ifo said Europe’s largest economy would likely avoid a recession this year.

All earnings and economic data will be closely watched, with central banks due to take the spotlight next week. The Federal Reserve meets Tuesday to Wednesday, while the European Central Bank and Bank of England will announce their hiking decisions Thursday.

In Asia, shares traded higher Friday, though U.S. futures were lower.

European markets: Here are the opening calls

European markets are heading for a mixed open on Friday, mainly continuing Thursday’s positive momentum after start of year rally stalled this week.

The U.K.’s FTSE 100 index is expected to open 5.5 points higher at 7,768, Germany’s DAX 16 points higher at 15,142 and Italy’s FTSE MIB 50 points higher at 26,308. However, France’s CAC was seen down 4.5 points at 7,092, according to data from IG.

Earnings come from H&M and Signify. French consumer confidence data for January will also be released.

— Jenni Reid

Buy the dip? Top Morningstar strategist names 3 stocks trading at a steep discount

This year is shaping up to be a “tale of two halves,” according to Dave Sekera, chief U.S. market strategist for Morningstar.

While the U.S. market is likely to stay volatile in the first half of this year, he told CNBC’s “Street Signs Asia” last week that he expects a sustained rally in the second half.

— Weizhen Tan

U.S. GDP rose 2.9% in the fourth quarter, more than expected even as recession fears loom

U.S. GDP grew by an annualized 2.9% in the fourth quarter, the Commerce Department reported Thursday, above a consensus estimate of 2.8% from economists polled by Dow Jones.

The growth rate was slightly slower than the 3.2% pace in the third quarter.

Source : cnbc