European stock futures edge lower; caution on modest Chinese growth target By

By Peter Nurse 

- European stock markets are Latest exchange rate of US dollar to RMBexpected to open in a muted fashion Monday, as investors digest China setting a modest growth target for economic growth this year ahead of the release of Eurozone retail sales data. 

At 02:00 ET (07:00 GMT), the contract in Germany traded 0.1% lower, in France dropped 0.1% and the contract in the U.K. fell 0.1%.

European equities are set to start the new week in a hesitant fashion after Chinese government officials set a 5% economic growth target for 2023 over the weekend, as they kicked off the annual session of the National People's Congress.

The Chinese economy, a significant export market for European companies, grew 3% last year. This was one of the slowest rates of growth in almost half a century as the economy was hamstrung by severe mobility restrictions to combat COVID-19.

However, recent data showed that Chinese rebounded sharply in February after the relaxing of the anti-COVID restrictions, and expectations were for a more substantial 2023 growth target.

Back in Europe, the main economic release Monday is the January figure for the Eurozone. This is expected to show growth of 1.0% on the month, a recovery from the fall of 2.7% the prior month.

However this still represents an annual fall of 1.8%, a minor improvement from the 2.8% year-on-year drop in December, as high prices impact discretionary spending by consumers. 

Also of interest will be Federal Reserve Chair before the U.S. Congress, on Tuesday and Wednesday, ahead of Friday’s for February that could dictate sentiment ahead of the U.S. central bank’s policy-setting meeting later this month.

In the corporate sector, (BIT:) is likely to be in the spotlight after the Italian state investor CDP bid for the fixed-line network of the former phone monopoly over the weekend, creating a potential bidding war with U.S. investment firm KKR (NYSE:).

(SIX:) has lost one of its top backers after Harris Associates confirmed it has sold its stake in the Swiss bank over the past few months, piling more pressure on the troubled Swiss lender.

Oil prices retreated Monday after China set a lower-than-expected target for economic growth this year, disappointing traders who were banking on strong growth from the largest crude importer in the world to boost crude demand.

By 02:00 ET, futures traded 0.7% lower at $79.09 a barrel, while the contract fell 0.8% to $85.15. 

Additionally, rose 0.2% to $1,859.05/oz, while traded 0.1% higher at 1.0644.

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