European markets are expected to open slightly higher Tuesday as investors hope for further action on the euro zone debt crisis.
The DAX was called up by 24 points, while the CAC, was expected to open up 14 points. The FTSE is closed for the second public holiday for Queen Elizabeth II’s Diamond Jubilee.
The G7 group of the world’s leading economic powers is to hold a conference call on Tuesday to discuss the debt crisis in the euro area. A spokesman for the U.S. Treasury said: “We're hoping to see accelerated European action over the next several weeks, including in the run-up to the leaders’ G-20 meeting in Mexico.”
Asian stocks rebounded on Tuesday on hopes that there could be a resolution to the debt crisis.
There is expected to be further bad news from economic data in the euro zone on Tuesday. The euro zone services PMI is expected to deliver a reading of 46.9 for May – which indicates that the sector shrank. This is a key forward-looking indicator for the economy of the single currency region.
Greece continued to be a flashpoint for concerns about the region, and rating agency Standard and Poor's said there is "at least" a one-in-three chance of the country exiting the euro zone in the coming months.
The UK suffered a downgrade Monday night by ratings firm Egan-Jones to AA- from AA, over concerns about the country's debt and banking system – another sign that the country is not going to be immune to the troubles of its neighbors in the euro zone.