BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - European stocks may inch higher at open on Wednesday after Italy's opposition Democrats (PD) and rival populists' 5-star movement expressed optimism over negotiations to potentially form a government.
Meanwhile, as the U.S.-China trade war intensifies, investors ramped up bets that policymakers around the world will be forced to support economic growth.
Asian markets are trading mixed as a deepening of the inversion in the yield curve between the 2-year and 10-year U.S. Treasuries underscored worries about a looming recession.
Trade tensions linger after Japan officially removed South Korea from a list of preferred trading partners.
China's yuan inched up against the dollar, snapping its nine-day losing streak as the official guidance rate came in much stronger than forecast.
Gold hovered near a six-year high and the dollar held steady while oil prices extended overnight gains on industry data showing a drawdown in U.S. crude inventories.
In economic releases, U.K. shop prices continued to fall in August on weak consumer spending and stiff competition, data from the British Retail Consortium showed earlier today.
The shop price index dropped 0.4 percent year-on-year in August as non-food prices plunged 1.5 percent. Meanwhile, food prices gained 1.6 percent.
Market research group GfK will release Germany's consumer sentiment data later in the day. The forward-looking consumer sentiment index is expected to drop slightly to 9.6 in September from 9.7 in August.
Overnight, U.S. stocks turned lower as bond yields slipped again on uncertainty over progress in U.S.-China trade negotiations.
The Dow Jones Industrial Average dropped half a percent while the S&P 500 and the tech-heavy Nasdaq Composite eased around 0.3 percent.
European markets gained ground on Tuesday after China said it is planning to relax restrictions on auto purchases in the country to help boost consumption.
The pan European Stoxx 600 advanced 0.6 percent. The German DAX rose 0.6 percent and France's CAC 40 index gained 0.7 percent while the U.K.'s FTSE 100 slid 0.1 percent.
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