European Shares To Drift Lower Ahead Of Eurozone, US Inflation Prints

(RTTNews) - European stocks are seen opening slightly lower on Friday as investors react to weak Chinese data and await key inflation readings from the euro zone and the U.S. for direction.

Asian markets traded higher as weak Chinese PMI data sparked hopes of stimulus support.

Official data showed Chinese manufacturing activity unexpectedly contracted in May - with the corresponding PMI falling to 49.5 from 50.4 in April.

The non-manufacturing PMI - a measurement of sentiment in the service and construction sectors - fell to 51.1 from 51.2.

U.S. stock futures slipped after Dell Technologies forecast current-quarter profit below market estimates.

Treasury yields were little changed while the dollar weakened against major currencies ahead of the release of key euro zone and U.S. inflation readings later in the day.

Gold held steady and was set for a fourth monthly gain. Oil extended overnight losses after EIA data showed a jump in gasoline inventories in the week ended May 24th.

In economic releases, U.K. house price data, France consumer spending figures and CPI data for EU, France and Italy may garner investor attention later in the day.

Across the Atlantic, the U.S. Commerce Department is due to release its report on personal income and spending in the month of April, which includes readings on inflation said to be preferred by the Federal Reserve.

Economists expect consumer prices to rise by 0.3 percent in April, matching the increase seen in March, while the annual rate of consumer price growth is expected to come in unchanged at 2.7 percent.

The data could have a significant impact on the outlook for interest rates, as Fed officials have repeatedly said they need "greater confidence" inflation is slowing before they will consider cutting rates.

Fed Bank of New York President John Williams said Thursday he doesn't see any imminent need to cut interest rates.

U.S. stocks ended lower overnight as software giant Salesforce reported disappointing quarterly results and revised data showed the U.S. economy grew less than previously expected in the first quarter.

GDP grew 1.3 percent in the first quarter compared to the previously reported 1.6 percent jump.

Weekly jobless claims rose more than expected while pending home sales in April fell to their slowest pace since April 2020, separate set of data revealed.

The Dow shed 0.9 percent to reach its lowest closing level in almost a month, the S&P 500 dipped 0.6 percent and the tech-heavy Nasdaq Composite gave up 1.1 percent.

European stocks rose on Thursday as bonds regained some ground after a sell-off the previous day.

The pan European STOXX 600 gained 0.6 percent. The German DAX edged up 0.1 percent while France's CAC 40 and the U.K.'s FTSE 100 both gained around 0.6 percent.