European shares were set to open flat to slightly firmer on Tuesday, supported by a higher close on Wall Street overnight, although a rebound in oil prices will keep a lid on gains.
Attention is the Federal Reserve, which kicks off its two-day meeting and is expected to result in a rise in U.S. interest rates on Wednesday, while investors will also get a look at the health of the euro zone's manufacturing sector.
Earnings reports from companies including German printing machine maker Heidelberger Druck and Swiss specialty chemicals firm Ciba feature in Europe, while U.S. heavyweights reporting include Google, Xcel Energy and Yum Brands.
The dollar was holding in a tight range ahead of the Fed meeting and a gathering of Group of Seven finance ministers and central bankers later in the week, while long-dated government bonds were firm.
MARKET OUTLOOK
* Financial bookmakers in London expect the FTSE 100 , CAC-40 , and DAX indexes to open flat to 5 points higher.
* The FTSEurofirst 300 index of leading European shares closed at 2-1/2 year highs on Monday, boosted by relief that Iraq elections had passed and signs of renewed corporate activity. Click here [ID:nL31523953] for the closing European market report.
* U.S. stocks also rose on the last day of the month, with corporate activity a factor on Wall Street too.
* Long-dated U.S. Treasuries climbed, pushing the yield on 30-year bonds to a 1-1/2 year low after data showed subdued U.S. inflation. Benchmark U.S. 10-year yields were trading at around 4.14 percent.
Comparable 10-year European government bonds yielded 3.54 percent.
* U.S. crude oil futures rose above $48 a barrel late on Monday, with traders citing concern about possible OPEC production cuts, even though the cartel kept output steady at its weekend meeting.
* The dollar was stuck in a range ahead of the Fed meeting and a gathering of the Group of Seven finance ministers and central bankers late in the week.
* In Tokyo, the Nikkei average was down with nerves ahead of earnings reports from tech heavyweight Sharp Corp.
* Other Asian indexes like the Kospi , Hang Seng and Straits Times were mixed.
* Gold prices held steady in Asian trade, with jewellers and investors buying at lower levels after the metal fell sharply in New York close. Enthusiasm for gold as a safe haven investment waned as Iraqi elections passed with less ferocity than had been feared.