European stock markets are likely to begin lower on Tuesday, ahead of the publication of crucial regional economic activity data that will offer direction.

European stock markets are likely to begin lower on Tuesday, ahead of the publication of crucial regional economic activity data that will offer direction.

The major emphasis of this session will be on flash PMI data from the Eurozone and the United Kingdom, which are expected to provide investors with insight into the current direction of economic developments in the manufacturing and service sectors.

These figures will be scrutinised closely since they will reveal how well the European economy, in particular, is going after surprisingly increasing in the fourth quarter of 2022.

Markets are also cautious as Russian President Vladimir Putin is scheduled to deliver a speech later in the afternoon as his invasion of Ukraine approaches its second year.

On Monday, US Vice President Joe Biden tried to anticipate this message by paying a surprise visit to Ukraine, where he pledged his support for as long as it takes.

HSBC will be in the limelight in the corporate sector after the European Union's largest bank announced a strong increase in fourth-quarter earnings earlier Tuesday, while also giving a special dividend on the sale of its Canada division.

BHP earlier reported a steep drop in half-year earnings due to slower Chinese demand and falling iron ore prices, but the Anglo-Australian miner voiced optimism for the future months, expecting for a rebound in demand from its biggest client, China.

Oil prices dipped on Tuesday, driven down by the strength of the US dollar as traders await further data cues this week on the future of US monetary policy.

This month's strong economic statistics has fueled predictions that the Federal Reserve will have to tighten more than originally estimated. This has boosted the currency, making crude denominated in dollars more expensive for overseas customers.

Key Developments today:

• German PMIs (Feb) at 8:30 GMT.
• UK PMIs at 09:30 GMT.
• German ZEW Economic Sentiment (Feb) at 10:00 GMT.
• US Existing Home Sales (Jan) at 15:00 GMT.

(Investing.com, Reuters.com)