European shares steady, interest rate uncertainty remains
By Amruta Khandekar and Shreyashi Sanyal
(Reuters) -European shares were steady in thin trading on Tuesday, with a lack of fresh economic data from the region and uncertainty around the direction of global interest rates keeping investors cautious.
The pan-European STOXX 600 index inched 0.1% higher at the close, trading within a two-point range for much of the day as investors weighed hawkish signals from central bankers against data pointing to slowing global growth.
«In what has been another quiet session European markets have traded sideways with little in the way of overall direction, with U.S. markets closed for the Independence Day holiday,» said Michael Hewson, chief market analyst at CMC Markets.
Top central bankers have maintained their focus on bringing inflation back to their target levels, even in the face of slowing growth in the U.S. and the euro zone, adding to uncertainty about future global monetary policy steps.
«Data in the U.S. and EU is increasingly pointing to the growing risk of slowing economic activity but where both the Fed and ECB (European Central Bank) continue to raise the spectre of higher interest rates to come,» said Stuart Cole, chief macro economist at Equiti Capital.
«Consequently, I think we may see the market start to view the gains in stock prices made so far this year as worth capturing and that valuations will be lowered going forward.»
Earlier in the day, Australia's central bank held interest rates steady, but reiterated its warning that further tightening might be needed to cool prices.
Analysts also pointed to a light economic data calendar and thin trading volumes influencing market moves, with Wall Street closed for the U.S. July 4 holiday.
Among sectors, miners fell 0.4%
Read more on investing.com
