By Peter Nurse
Investing.com – European stock markets are seen opening mixed Wednesday after suffering their worst daily loss so far this year on Tuesday, amid hopes that a positive corporate earnings season will calm concerns about the march of Covid-19 in India.
At 3:05 AM ET (0705 GMT), the contract in Germany traded 0.2% higher, the contract in the U.K. rose 0.2%, while in France dropped 0.1%.
“We believe first-quarter earnings season will be strong, and expect European companies to improve on the beat posted in 4Q ‘20,” said analysts at Morgan Stanley (NYSE:), in a note. “European/global macro data remain supportive and upgrades to EPS estimates in the run-up to reporting season have lifted European earnings revisions to the top of their 5-year range.”
Akzo Nobel (OTC:) will be in focus after the Dutch paints company reported a 90% increase in first-quarter profit, while announcing a $1.2 billion share buyback program. The stock has already hit a series of record highs this year as its paints and coatings business gained momentum and market share.
ASML (AS:), the Dutch maker of chipmaking equipment, raised its 2021 guidance after first-quarter net profit soared, while the Swiss drugmaker Roche (SIX:) confirmed its guidance for this year despite its sales falling slightly in the first quarter.
Still, some tech shares and companies that benefited from stay-at-home demand could face pressure after U.S. streaming giant Netflix (NASDAQ:) reported disappointing subscriber growth for its movie streaming service late Tuesday.
Additionally, recent optimism about rising vaccination rates in the United States, Britain, and Europe is shifting to concern that record coronavirus infections in India and the reinforcement of travel restrictions will act as a brake on the global economy.
India, the world’s second most populous country, reported its Covid toll on Tuesday from the world’s highest number of new daily cases. This has led to the imposition of a six-day lockdown throughout much of the country, as well many countries putting India on their banned travel list.
Back in Europe, U.K. rose 0.7% on the year in March, slightly below the 0.8% expected, illustrating that the Bank of England is under no immediate pressure to tighten its ultra easy monetary policies.
Oil prices weakened Wednesday, handing back some of the year’s strong gains as concerns over a rise in the number of Covid-19 cases in India, the world’s third largest crude importer, and a surprise build in oil supplies renewed fuel demand worries.
U.S. crude oil stocks rose by 436,000 last week, according to data from industry body the , compared with an expected draw of around 3 million barrels..
The U.S. will release its inventory data for last week later on Wednesday.
U.S. crude futures traded 0.6% lower at $62.27 a barrel, while the contract fell 0.6% to $66.19. Both contracts are up just short of 30% in 2021.
Elsewhere, rose 0.4% to $1,786.25/oz, while traded flat at 1.2031.