European Shares Seen Opening Lower Amid Lira Turmoil

European stocks are seen opening lower on Monday as a plunge in the Turkish lira sparked talk that capital controls might be needed to stem the rout.

The currency plunged 15 percent to near its all-time low following President Tayyip Erdogan’s shock weekend decision to oust a hawkish central bank governor and install a like-minded critic of high interest rates.

Most Asian currencies weakened while the dollar gained ground versus peers on safe-haven demand. Oil and gold prices fell on dollar strength while Asian markets are trading on a mixed note as investors await cues from a series of upcoming Treasury auctions.

Investors also await speeches from a host of Fed officials, including three appearances by Chair Jerome Powell this week for more clues about the magnitude and length of policy tightening.

On the data front, U.S. reports on new and existing home sales, durable goods orders, and personal income and spending may offer more clues on the state of the economy.

U.S. stocks ended mixed on Friday as Treasury yields hovered near 14-month highs and the Federal Reserve said it was ending a yearlong reprieve that had eased capital requirements for big banks.

The tech-heavy Nasdaq Composite rose 0.8 percent to rebound from the previous session’s sell-off, while the Dow shed 0.7 percent and the S&P 500 slipped 0.1 percent.

European stocks ended Friday’s session lower as investors fretted over rising coronavirus cases and fresh lockdowns in the region to combat the deadly new outbreak.

The pan European Stoxx 600 gave up 0.8 percent. The German DAX, France’s CAC 40 index and the U.K.’s FTSE 100 all tumbled around 1.1 percent.

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