Wednesday sees a higher opening for European stocks

Wednesday's gains in European stock markets were driven by a resurgence of optimism regarding the result of the major central banks' tightening cycle.

Recent economic data have suggested that the eurozone may enter a recession in the fourth quarter of the year, but this has increased investor confidence that the European Central Bank's prolonged cycle of interest rate hikes has come to an end.

German factory orders fell 3.7% in October, according to data released on Wednesday. This was a significant decline from the revised 0.7% gain in the previous month.

Later in the session, European retail sales are anticipated to increase by 0.2% from the previous month in October, representing a 1.1% annual decline as consumers continue to struggle with the combination of high prices and interest rates.

ECB policymakers and Fed officials, including Fed Chair Jerome Powell at the end of last week, have been showing signs of dovishness. Additionally, when it meets later in the day to discuss policy, the Bank of Canada is probably going to maintain this narrative by keeping interest rates unchanged.

Wednesday saw a slight increase in U.S. crude stockpiles. China's economic problems and the disappointing OPEC+ output cuts have kept oil prices stuck close to five-month lows.

Over the past six weeks, crude prices have crashed, with the majority of losses occurring in recent sessions as the markets were largely unimpressed by OPEC’s announcement that it would be cutting production even further in 2024.

Furthermore, according to information provided by the American Petroleum Institute, U.S. oil inventories increased by 594,000 barrels in the week ending December 1st as opposed to projections of a drawdown of more than 2 million barrels.

(Sources: investing.com, reuters.com)