European Stocks Seen Slightly Higher; Debt Worries Linger
European stocks were predicted to open slightly higher on Tuesday after closing down on Monday amid renewed concerns over the European debt crisis and political deadlock in Washington over the US debt ceiling.
The FTSE is expected to open 4 points higher on Tuesday to 5929, Germany’s DAX is predicted to be up by 13 points to 7358 and the CAC 40 in France is called 12 points higher at 3825.
Credit rating agency Moody's ended a short-lived period of optimism over the euro zone sparked by last Thursday's agreement on a Greek bailout, by cutting Greece's credit rating to just one notch above default and saying the chance that Greece will default was "almost 100 per cent certain."
In the US, President Obama warned of the consequencesof a "reckless and irresponsible" US default in an address to the nation on Monday night, which is expected to deepen market concerns on Tuesday.
Second quarter results for Deutsche Bank showed a 1.3 billion euro ($1.9 billion) rise in net profits on Tuesday morning, folllowing UBS results which showed a 1.7 billion Swiss franc ($2.1 billion) fall.
Oil giant BP will be in the spotlight when it announces second quarter earnings at 7:00 London time.
The firm has suffered a number of setbacks since the Deepwater Horizon disaster in 2010 including the apparent collapse of a deal with Rosneft after BP's partners in its joint Russian venture TNK-BP blocked a share swap agreement.
A preliminary estimate of second quarter UK GDP data is expected to show sluggish growth of around 0.5 percent when it is released at 8:30.
In the euro zone, Spain will be in focus when the Spanish government published budget deficit details for June amid lingering concerns that the Greek debt crisis could spread to other peripheral European economies.
Corporate results to watch later include French luxury good firms LVMH and Euler Hermes, which is due at 4:35 London time.