European markets were slightly higher on Monday as investors braced for a busy week in US politics, with the midterm congressional elections, as well as the latest consumer inflation report.
The Stoxx 600 The index added 0.2% in afternoon trading after a busy week for markets last week as central banks continued aggressive monetary tightening in a bid to contain inflation.
Basic resources led the gains, gaining 1.4%, while healthcare stocks fell 0.5% by mid-afternoon.
The Bank of England implemented a 75 basis point interest rate hike on Thursday, but warned the UK economy was facing its longest recession on record, and the US Federal Reserve also opted to an increase of 75 basis points on Wednesday.
Overnight Monday-Monday, Hong Kong stocks led the gains in the Asia-Pacific region as trade data from China came in well below expectations, marking the first annual drop in exports since May 2020.
U.S. stocks, meanwhile, were mixed in early trades as investors looked ahead to Tuesday’s midterm elections, which will determine which party controls Congress and could affect the direction of future spending.
Democrats currently control the House and have a majority in the Senate. A Republican sweep could signal greater support for oil and gas companies.
On the economic front, investors expect Thursday’s U.S. Consumer Price Index report to provide some insight into the Federal Reserve’s efforts to crush inflation. A hot inflation report could signal to investors that a pivot from higher interest rates, for longer, may be further away than expected.
– CNBC’s Sarah Min contributed to this report.