European markets to open lower as political uncertainty takes center stage

Big 5

Bourses in Europe are expected to open lower Wednesday morning as investors digest news of snap elections in the U.K. and wait for new data and earnings reports.

The FTSE 100 is seen 37 points lower at 7,119; the CAC 40 is set to begin trade 12 points down at 4,984 and the German DAX is expected to open lower by 35 points at 11,993.

Europe is set for another general election this year, after U.K. Prime Minister Theresa May called a snap vote for June 8.

The Conservative leader aims to strengthen her parliamentary majority before reaching a Brexit deal with the European Union.

Sterling surged to a more than six-month high following the news on expectations that the election could lead to a more market-friendly exit from the EU.

Politics aside, investors will be looking at the latest earnings reports of Heineken, Burberry, Rio Tinto and AB Foods. In the U.S., Morgan Stanley is due to unveil its latest earnings, due before the bell, after Goldman Sachs surprised on Tuesday with an earnings miss.

In terms of data, the euro zone will receive final March inflation figures at 10:00 a.m. London time.

Later, the International Monetary Fund is releasing the main chapters of its Global Financial Stability Report.

Elsewhere, the German government said that an interest rate hike by the European Central Bank would help the country’s export surplus and it would be in line with the economic recovery seen in Europe, according to the Funke Mediengruppe newspaper.

Source: CNBC

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