European Stocks Set for Softer Open

EU50 decreased to 6404.00 Index Points, the lowest since August 2026. Over the past 4 weeks, Euro Area Stock Market Index (EU50) lost 0.32%, and in the last 12 months, it increased 21.07%.

European stocks were broadly flat to higher on Tuesday as investors kicked off September by looking past another rise in oil prices amid escalating tensions between the US and Iran. The increase in energy prices is adding to inflationary pressures and strengthening expectations that the ECB will raise interest rates further. Eurozone flash inflation figures are expected to reinforce expectations for further monetary-policy tightening. At the sector level, chemicals was among the best performers. Air Liquide shares gained around 3.8% after reports that activist investor Elliott Management had built a stake in the company. Tech stocks also advanced, with ASML rising 1.5% and Infineon gaining 2.5%. Energy stocks were another source of strength as higher oil prices supported the sector, with TotalEnergies up 2.1% and Eni gaining 1.6%. On the other hand, Rolls-Royce (-3.8%) and Rheinmetall (-1.8%) were among the worst performers and Roche (-2%) and SAP (-2.1%) also booked losses.

European equity markets were set to open slightly lower on Tuesday, extending losses from the previous session as rising global bond yields and elevated oil prices heightened concerns over persistent inflation and the prospect of imminent interest rate hikes. The Euro area 10-year government bond yield climbed to around 3.64%, its highest level since April 2011, with the European Central Bank expected to deliver a 25 basis point rate hike at its September 9-10 policy meeting. Meanwhile, investors will assess Eurozone and Italian inflation, German retail sales and UK housing prices data, along with manufacturing PMI reports from across the region. No major earnings releases are scheduled in Europe on Tuesday. In premarket trading, Euro Stoxx 50 and Stoxx 600 futures were both down about 0.1%.