European stock markets are expected to register modest gains as a new week begins, with Germany's DAX futures contract showing a 0.4% uptick at 02:00 ET (06:00 GMT). Similarly, France's CAC 40 futures climbed by 0.3%, and the FTSE 100 futures contract in the UK rose by 0.4%. These marginal increases come ahead of a series of pivotal central bank meetings set to take place in the United States, Asia, and Europe throughout the week.
Investors are preparing for monetary policy decisions from three major central banks: the Federal Reserve, the European Central Bank (ECB), and the Bank of Japan. With no significant corporate earnings or economic data releases scheduled, the focus shifts to these central bank meetings. The Federal Reserve's two-day meeting concludes on Wednesday, and it is widely expected that the central bank will pause its tightening cycle, assessing the impact of previous interest rate hikes. However, Tuesday's release of consumer inflation data may still bring surprises. Recent unexpected interest rate hikes by the Reserve Bank of Australia and the Bank of Canada add an element of uncertainty. On the other hand, the ECB has already indicated its plans for a rate increase on Thursday, while the Bank of Japan is expected to maintain its loose monetary policy.
In corporate news, Swiss banking giant UBS (SIX:UBSG) announced the successful completion of its acquisition of struggling rival Credit Suisse. The newly formed entity now possesses an impressive balance sheet totaling $1.6 trillion. Additionally, Novartis (SIX:NOVN), a Swiss pharmaceutical giant, unveiled its intention to acquire Chinook Therapeutics (NASDAQ:KDNY), a U.S.-based company, for an upfront payment of $3.2 billion. The deal is expected to be finalized in the second half of this year. Meanwhile, BioNTech (ETR:22UAy), a prominent biotech company, faces a high-profile court case in Germany. A woman has filed a lawsuit claiming adverse side effects from the company's COVID-19 vaccine, making this trial of significant importance due to its potential repercussions.
Oil prices retreated today following comments by Iran's supreme leader regarding the country's nuclear program. Ayatollah Ali Khamenei suggested that Iran is open to a deal with the West, which could lead to an increase in oil supply if sanctions on Iranian crude exports are lifted. However, Western leaders may find it challenging to accept the condition of keeping Iran's nuclear infrastructure intact. Recent reports of an interim nuclear deal between Tehran and Washington have been denied by both parties. Consequently, U.S. crude futures experienced a 1.2% decline, trading at $69.31 per barrel, while the Brent contract dropped by the same percentage, reaching $73.93.
In the currency market, gold futures fell 0.2% to $1,973.75 per ounce, and the EUR/USD pair traded 0.1% lower at 1.0746. Looking ahead, major European markets traded higher during the pre-market session on Monday as investors prepare for new data releases and the crucial interest rate decision by the European Central Bank scheduled for later this week. At 8:01 am CET, the DAX gained 0.10%, the CAC 40 added 0.09%, and the FTSE 100 rose 0.37%. The pan-European Euro Stoxx 50 advanced by 0.33% shortly after.
On the currency front, the euro and the British pound remained flat at 8:00 am CET, with exchange rates of $1.07498 and $1.25753, respectively.
