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Stock markets in Europe are weaker today as the macroeconomic outlook isn’t looking particularly rosy. 

The chatter of a potential trade war is still in circulation, especially now the EU is contemplating imposing a digital sales tax. Should it be introduced, it could impact companies like Facebook and Google.

Kingfisher shares are under pressure after the company posted a fall in profit. Although revenue rose by 3.8%, profit fell by 10%. Its Polish business and the Screwfix unit in the UK are performing well, put product availability issues at the French operation weighed on the group. The company will continue with its transformation programme, but the outlook remains mixed. The stock is down 7.8% today. 

Softcat shares are in the red despite the company posting respectable figures. First-half revenue rose by 24.8% and gross profit jumped by 22.2%. The interim dividend was increased by 3.3%. The stock has been popular with brokers, as companies like Berenberg, Jefferies and Investec all upped their rating on the company in the past couple of months. The stock has had a great run over the last 15 months, so some profit-taking isn’t a surprise. 

At 6pm (UK time) the Federal Reserve will announce its latest interest-rate decision, and the consensus is for a rate hike of 0.25%, to 1.75%. The press conference gets underway at the same time. Traders will be listening closely to the tone of new Federal Reserve chief Jerome Powell’s speech, as he could offer clues about future monetary policy. 

GBP/USD jumped on the back of solid wages and jobs data from the UK. British average earnings excluding bonuses rose from 2.5% to 2.6% in January – meeting estimates. The unemployment rate ticked down to 4.3% from 4.4%, against expectations for it to remain at 4.4%.

We are expecting the Dow Jones to open up 3 points at 24,730 and we are calling the S&P 500 up 1 points at 2,716.

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