European stocks seen sharply lower on Powell’s comments; Solvay, Carrefour to report

European equities are expected to open sharply lower on Wednesday morning following comments from Fed Chairman Jerome Powell committing to a gradual increase in interest rates.

The FTSE 100 is seen off by 45 points at 7,233; the DAX is expected to open lower by 61 points at 12,413; and the CAC 40 in Paris is set to start down by 28 points at 5,308; according to IG at about 3.40 a.m. London time.

In Asia, markets traded lower following the sentiment seen on Wall Street, where indexes saw declines above 1 percent impacted by Powell’s testimony. The recently-appointed chairman said that it was possible the central bank could increase rates more than three times this year.

Expectations of a more hawkish Fed are traditionally harmful to stocks as higher rates increase firms’ costs.

Back in Europe, investors will also monitor further earnings. Solvay, Carrefour, Bayer, Ahold Delhaize, Repsol, ITV, Taylor Wimpey will be among the companies reporting Wednesday.

In other corporate news, Novo Holdings of Denmark has invested $165 million in the first venture fund investing in companies fighting superbugs resistant to modern drugs. The fund launches Wednesday.

In terms of data, there will be core inflation numbers in the euro zone due at 10 a.m. London time. Source: CNBC