European Shares Set To Open On Tepid Note

European stocks are likely to open on a subdued note Wednesday as investors await concrete details from the Sino-U.S. trade negotiations.

As the two sides try to hammer out details of the "phase one" trade deal, Beijing wants Washington to make a solid commitment towards removing tariffs.

Meanwhile, after the surprisingly strong October jobs prints and the upward revisions to August and September jobs creation, market participants are now discussing whether the Federal Reserve would rethink its future rate cuts.

"The strength of consumption and the labor market might be saying 'hold' or even 'raise rates,' while the softness of investment, inflation and the bond market might be saying 'lower rates,'" Richmond Fed President Thomas Barkin said on Tuesday.

The dollar held onto overnight gains and Asian markets are trading mixed while oil prices fell after industry data showed a larger-than-expected build-up in U.S. crude stockpiles.

In economic releases, British small and medium-sized manufacturers optimism dropped at the fastest pace since mid-2016, quarterly survey from the Confederation of British Industry showed.

According to SME Trends Survey, business sentiment fell to -32 in three months to October, the fastest fall since July 2016.

Final composite Purchasing Managers' survey and retail sales data from euro area and factory orders from Germany are due later in the session, headlining a busy day for the European economic news.

Overnight, U.S. stocks ended mixed as investors digested strong data on the services sector and trade balance and watched the latest developments on the trade front.

The Dow Jones Industrial Average edged up 0.1 percent and the Nasdaq Composite inched up marginally to hit record closing highs while the S&P 500 slipped 0.1 percent.

European shares hit more than four-year highs on Tuesday as hopes for a U.S.-China trade deal helped offset disappointing earnings news.

The pan-European Stoxx Europe 600 index closed 0.2 percent higher. The German DAX inched up 0.1 percent, France's CAC 40 index rose 0.4 percent and the U.K.'s FTSE 100 gained 0.3 percent.

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