European Stocks Called Higher; Politics In Focus Ahead of Catalan Deadline


European stocks are expected to open higher Monday, following another solid assessment of economic growth in China, although political developments around the region are likely to influence trading throughout the session.

Britain’s FTSE 100 is set for a modest 5 point gain at the opening bell, according to financial bookmakers IG, with advances being held down once again by the elevated pound, which is marked at 1.3279 against the U.S. dollar. Germany’s DAX performance index is slated to gain around 24 points, or 0.18%, with Volkswagen AG (VLKAY) shares likely to be active following a shock defeat for Chancellor Angela Merkel’s CDU party in elections in the carmaker’s home state of Lower Saxony.

Spanish stocks will also be in focus as a 10:00am CET deadline looms for Catalan President Carles Puigdemont to clarify the breakaway region’s declaration of independence. If the declaration is formalized, Spain’s Prime Minister, Mariano Rajoy, could trigger a process known as Article 155 that would allow him to overtake control of the country’s richest region. 

Overnight in Asia, the broadest measure of share prices, the MSCI Asia ex-Japan index, held at a 10-year high while the Nikkei edged 0.47% past its 26-year high, closing at 21,255.56 points, thanks in part to stronger-than-expected factory gate inflation data from China and a forecast from the country’s central bank that the world’s second-largest economy is set to grow a 7% clip for the whole of 2017.

Global oil prices jumped higher on the back of the news, which supports the record high level of crude imports recorded last month by customs officials, as well as concern that President Donald Trump may impose renewed sanctions on Iran after he decertified an agreement the 2015 nuclear agreement with Tehran.

West Texas Intermediate crude futures for December delivery were marked 0.75% higher at $51.84 while Brent contracts for the same month, the global benchmark, were seen 1.2% higher at $57.75 each.

Early indications from U.S. equity futures suggest a small set of gains for Wall Street at the opening bell, with the Dow Jones Industrial Average marked 19 points, or 0.08% higher and the S&P 500 likely to add around 1.75 points, or 0.07%, when trading kicks off later in the session.

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