BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - European stocks are seen opening broadly higher on Monday as oil prices retreated and focus shifted to several key central bank decisions, including the U.S. Federal Reserve's latest monetary policy meeting later in the week.
The Fed is scheduled to announce its latest monetary policy decision on Wednesday, with the central bank widely expected to leave rates unchanged.
With a quarter point rate hike still widely expected at the Fed's December meeting, traders are likely to keep a close eye on the accompanying statement.
In earnings news, prominent companies, including Microsoft, Alphabet, Amazon, Intel and SanDisk are due to report their earnings this week, with investors likely to focus on cloud growth, semiconductor demand and AI spending for fresh evidence of whether massive investments in AI infrastructure are generating sufficient returns.
Monetary policy decisions from the European Central Bank, Bank of Canada and Bank of Japan as well as the release of U.S. GDP and PCE inflation data could also shape rate expectations as the week progresses.
A combination of cautious central bank guidance and strong technology results may boost investors' appetite for risk as energy costs rise and the U.S. midterm elections approach.
Asian markets were mixed in cautious trade amid lingering concerns about the sustainability of AI-related spending.
Gold was up half a percent at $4,015 an ounce, hovering close to a three-month low after falling 4 percent last week, marking its biggest weekly decline since June.
A pull back in Treasury yields weighed on the dollar index as investors braced for the Fed decision.
Brent crude futures fell nearly 2 percent toward $114 a barrel after reports of diplomatic efforts to reduce regional tensions in West Asia.
A Qatari delegation arrived in Tehran on Sunday as part of renewed diplomatic efforts to de-escalate reginal tensions in coordination with the United States.
Saudi Arabia partially resumed operations at King Khalid International Airport in Riyadh on Sunday, even as Yemen's Iran-aligned Houthis vowed to keep striking the facility, calling it a 'military target.'
U.S. stocks ended lower on Friday on concerns over surging energy costs and a steady rise in bond yields.
Brent crude futures hit a six-month high above $116 a barrel while the 10-year Treasury yield rose toward 4.99 percent as Iran-allied Houthi militants continued their attacks against Saudi Arabia and fears grew of a new breakout in the Israel-U.S. war on Iran after the midterm elections.
Iran's army chief reportedly claimed the country's military is fully prepared for 'asymmetric warfare' after strengthening its capabilities.
In economic releases, data showed U.S. business activity grew at a slightly slower pace in October but remained close to a multi-year high. A measure of consumer sentiment hit its lowest level in five months in October as rising interest rates depressed morale.
While the tech-heavy Nasdaq Composite slid 0.2 percent to reach its lowest closing level since early August, the S&P 500 dropped half a percent and the Dow tumbled 1.2 percent.
European stocks edged lower on Friday as investors reacted to rising oil prices and largely weak regional PMI data. France's debt woes and uncertainty about returns on AI-related investments also kept investors on edge.
The pan-European STOXX 600 fell 0.3 percent. The German DAX dipped 0.8 percent, France's CAC 40 shed 0.4 percent and the U.K.'s FTSE 100 eased 0.3 percent.
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