European stock futures drift lower; debt agreement, Spanish inflation in focus By Investing.com

Investing.com – European stock markets are expected to open marginally lower Tuesday, with investors anxious to see how the weekend’s U.S. debt ceiling agreement will proceed through Congress.

At 02:00 ET (06:00 GMT), the contract in Germany traded 0.1% lower, in France dropped 0.1% and the contract in the U.K. fell 0.2%.

President Joe Biden and House Majority Leader Kevin McCarthy reached an agreement over the weekend to lift the $31.4 trillion federal debt ceiling until January 2025 in exchange for caps on spending and cuts in government programs.

However, the optimism surrounding this deal, thus avoiding a default on U.S. debt, has been tempered by concerns on how it will fare as it proceeds through both houses of a divided Congress.

Back in Europe, the main economic number due Tuesday is the for May, which is expected to show that prices are still rising, climbing 4.4% on an annual basis, from 4.1% the prior month.

This is likely to keep the pressure on the to keep tightening interest rates, likely hitting future economic activity.

Remaining in Spain, Prime Minister Pedro Sanchez called a snap election for next week, in a surprise move to keep his Socialist party in power after a regional election defeat over the weekend.

Oil prices edged lower Tuesday, reversing earlier gains on U.S. debt ceiling optimism as a stronger and concerns about China’s lackluster economic recovery weighed.

Worries over the strength of the Chinese recovery, the world’s largest crude importer, have hit the crude market this year, and traders are focusing on key and sector data for May, due on Wednesday.

A stronger dollar, which makes crude more expensive for foreign buyers, also weakened the oil market as hotter-than-expected U.S. pointed towards further hikes by the Federal Reserve.

By 02:00 ET, futures traded 0.6% lower at $72.26 a barrel, while the contract dropped 0.8% to $76.48. 

Additionally, fell 0.6% to $1952.00/oz, while traded 0.3% lower at 1.0690.