European Stocks Set for a Higher Open

European stocks rose on Friday, with the STOXX 50 and STOXX 600 each gaining 0.8% after touching four-month lows, as easing oil prices and bond yields lifted market sentiment. Brent retreated from recent highs after US President Donald Trump said Washington would not launch an attack on Iran before the November midterm elections, citing productive talks aimed at ending the conflict. Meanwhile, strong demand at a US 30-year Treasury bond auction helped push yields lower, suggesting investors remained willing to buy long-dated government debt despite the recent selloff. AI-related sentiment also strengthened following reports that OpenAI expected its annualized revenue to reach or exceed $70 billion by year-end, helping ease concerns triggered by earlier reports that revenue was running $20 billion below previously indicated levels. Separately, LSEG IBES data showed European third-quarter earnings growth expectations rising to 21%, from 19.4% a week earlier, ahead of the earnings season.

European equity markets were poised to open higher on Friday as easing bond yields and lower oil prices improved risk sentiment. Oil prices fell after President Donald Trump said the US was engaged in “productive discussions” with Iran and would refrain from attacking the country before the midterm elections. Meanwhile, global bond yields declined following strong demand at a US 30-year bond auction, indicating that investors remained willing to purchase long-dated government debt despite the recent selloff. Sentiment also improved after reports indicated that OpenAI expected annualized revenue to reach or exceed $70 billion by year-end, easing concerns sparked by earlier reports that revenue was $20 billion below previously indicated levels. Meanwhile, no major economic data releases or corporate earnings reports are scheduled in Europe on Friday. In premarket trading, Euro Stoxx 50 and Stoxx 600 futures both advanced around 0.7%.

European stocks closed sharply lower for a second session on Thursday as sovereign yields reignited their surge. The Euro STOXX 50 fell 0.8% to 6,132 and the STOXX Europe 600 dropped 0.7% to 625.7. Benchmark bond yields across the eurozone's largest economies extended yesterday's surge, especially among more indebted member states, reinforcing concerns over fragmentation across eurozone sovereign bond markets. Contagion fears continued to weigh on banking stocks, with UniCredit, Intesa Sanpaolo, ING, and Santander dropping between 2.5% and 3.1%. In addition, accounts of the latest ECB meeting confirmed that the Governing Council continues to see upside inflation risks in the bloc's economy. Meanwhile, Argenx tumbled over 15% after discontinuing its late-stage study of Vyvgart, a drug for adults with Sjögren's disease.