Global Economy
European Markets Expected to Open Lower Amid Middle East Tensions and U.S. Inflation Data
European equity indexes are set to start Tuesday in the red as investors keep a close eye on the escalating conflict in the Middle East and await the release of U.S. inflation data later today. Futures point to modest declines in the CAC 40, DAX, FTSE 100 and STOXX 600, while the Paris market remains open despite the national holiday, albeit with likely thin trading volumes.
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Market outlook for Tuesday, July 14, 2026
European equity indices are expected to start the day in the red as investors keep a close eye on the escalating conflict in the Middle East and await the release of U.S. inflation data later today.
- CAC 40 (Paris): Futures suggest an opening dip of around 0.15%.
- DAX (Frankfurt): Futures down about 0.38%.
- FTSE 100 (London): Futures slipping 0.03%.
- STOXX 600: Futures off 0.30%.
Although France celebrates its national holiday, the Paris exchange will remain open, albeit with likely thin trading volumes. Notably, the French‑made underwear brand “Slip Français” has made a symbolic debut on the Euronext Growth market.
The core driver of market sentiment remains the tension between the United States and Iran over the strategically vital Strait of Hormuz. The conflict has pushed crude oil prices to their highest level in almost a month.
President Donald Trump announced a renewed strike campaign aimed at degrading Tehran’s offensive capabilities and safeguarding the Hormuz passage, while also reinstating the naval blockade of Iranian ports.
Despite this escalation, Trump left open the possibility of a diplomatic settlement, adding to the market’s uncertainty that has persisted since the February‑end flare‑up.
Adding to the pressure, Federal Reserve Governor Christopher Waller warned that the Fed could raise rates in the short term if inflation data remain above the 2% target.
U.S. CPI figures are due later in the day, followed by Federal Reserve Chair Kevin Warsh’s testimony to Congress on the semi‑annual monetary policy report.
“Risk has accumulated in the system over the past week, and the markets reacted sharply to the latest information concerning the Iran‑U.S. confrontation,” said Chris Weston, director of research at Pepperstone Melbourne.
“A potential monetary tightening in a possible energy‑shock environment is rarely supportive for risk assets,” he added.
Source: Reuters.