European Stocks Poised for Higher Open

The Stoxx 50 traded flat to slightly higher on Friday, remaining close to record levels and heading for a fourth consecutive weekly gain. The Stoxx 600 was also little changed but was on track for a modest weekly decline. Investors assessed stalled efforts to end the US-Iran conflict, with traffic through the Strait of Hormuz still limited. On the other hand, sentiment was supported by renewed interest in artificial intelligence stocks and cooling US inflation, which strengthened expectations that the Federal Reserve will refrain from raising interest rates next month. Most major stocks traded lower, including ASML Holding, HSBC, Novartis and Roche, which fell between 0.2% and 0.9%. In contrast, technology stocks regained momentum after last month’s selloff, supported by strong earnings from major companies. SAP rose nearly 5%, while Amadeus IT gained more than 2%. Shell also advanced over 0.5% as oil prices moved higher.

European equity markets were set to open higher on Friday as softer-than-expected US inflation data eased concerns over an imminent Federal Reserve interest rate hike. Marekts are now assigning around a 35% probability to a 25 basis point Fed rate increase in September, compared with 55% a week earlier. Renewed demand for artificial intelligence-related stocks also supported broader risk sentiment across global markets. In Europe, investors will focus on the latest Eurozone GDP, employment and trade data, alongside German wholesale prices and French inflation figures. Meanwhile, no major earnings reports are scheduled in Europe on Friday. In premarket trading, futures for the Euro Stoxx 50 and Stoxx 600 were both up around 0.2%.

European stocks closed mostly higher on Thursday with support strong earnings results across multiple sectors. The Euro STOXX 50 gained 0.2% to 6,544 and the STOXX Europe 600 inched down to 659. ASML added 2.7%, closing sharply higher for a second session and tracking the AI infrastructure sector in the US and Asia on the sector's respite. On top of that, Adyen surged 16.4% after raising its revenue forecast for the current year. Danish shipping giant Maersk surged 9.4% after significantly exceeding profit expectations and raising its full-year earnings guidance, reflecting strong performance in its core businesses. Meanwhile, Entain and Danish offshore wind developer Orsted also reported first-half core profits above expectations.