European stocks are anticipated to open slightly lower on Friday, as Chinese leaders concluded a two-day economic planning session in Beijing without revealing specific details regarding any stimulus measures. The summary from this high-level economic policy meeting promised a more proactive financial strategy and an increase in debt relative to GDP, yet remained vague on the specifics of fiscal stimulus initiatives.
Analysts suggest that investors might need to wait until March for further clarity on the budget and spending plans intended to invigorate the Chinese economy. In the Asian markets, stocks generally declined, with significant losses noted in Chinese, Hong Kong, and Japanese markets.
The US dollar maintained its strength, hovering near a two-and-a-half-week high against other major currencies, as attention shifted towards the upcoming Federal Reserve meeting. The U.S. Federal Reserve is expected to reduce interest rates by 25 basis points on December 18th. However, there remains considerable uncertainty regarding the economic outlook for 2025.
Gold showed a slight increase in Asian trading, rising nearly 2 percent over the course of the week. Meanwhile, oil prices remained stable and are poised for their first weekly increase since late November, as investors consider the potential impact of tighter U.S. sanctions on Iran and Russia.
U.S. stocks closed lower overnight following significant gains in the previous session. The Dow Jones Industrial Average declined by 0.5 percent, marking its sixth consecutive session closure in the red. This was prompted by data indicating the largest increase in producer prices seen in five months for November, alongside an unexpected rise in weekly jobless claims.
The annual rate of producer price inflation accelerated to 3.0 percent in November, up from an upwardly revised 2.6 percent in October. This has prompted concerns about the pace at which the Federal Reserve might reduce interest rates early next year. Concurrently, the tech-focused Nasdaq Composite decreased by 0.7 percent, while the S&P 500 dropped by 0.5 percent.
In Europe, stock performances varied on Thursday after both the European Central Bank (ECB) and the Swiss National Bank (SNB) decided to lower their key interest rates. The pan-European STOXX 600 index slightly fell by 0.1 percent. France's CAC 40 also saw a marginal decline, whereas both Germany's DAX and the U.K.'s FTSE 100 edged up by 0.1 percent.
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