European stocks were steady on Tuesday, weighed down by weak regional growth as investors continued to monitor news regarding a possible interest rate cut by the Federal Reserve next month.
At 11:02 AM Saudi time, the DAX index in Germany rose by 0.1%, the CAC 40 index in France increased by 0.2%, and the FTSE 100 index in the United Kingdom also rose by 0.1%.
German economy stagnated in the third quarter
The German economy contracted in the third quarter of 2025 compared to the previous quarter, the statistics office said on Tuesday, confirming its initial reading.
In addition, Ifo data for November, released on Monday, showed that companies in the country had lowered their previous optimism, pointing to a difficult final quarter of 2025.
The combination of a still-weak current situation assessment component and declining expectations is yet another example of an economy still deeply mired in recession, ING analysts said in a note.
Data from the European Automobile Manufacturers Association on Tuesday showed that new car sales in Europe rose 4.9% in October, with electric vehicles outperforming petrol and diesel sales.
Despite this recent positive momentum, overall volumes remain significantly below pre-pandemic levels, ACEA said. The market share of battery electric vehicles has reached 16.4% year-to-date, but this is still below the pace required at this stage of the transition.
US economic data flow
Elsewhere, investors remain focused on developments in U.S. interest rates after Federal Reserve Governor Christopher Waller reiterated that a weak labor market could justify an additional quarter-point rate cut in December.
His comments, along with similar views from his colleague John Williams last week, helped raise investors' expectations of an interest rate cut next month.
Traders are now pricing in an 81% probability of an interest rate cut next month, compared with 42% a week ago, according to CME FedWatch.
There is a wealth of US data due later in the session, including retail sales and the producer price index for September, but the lack of current data, following the extended Federal Reserve shutdown, underscores the challenge the market faces in pricing in near-term interest rates.
EasyJet raises holiday target
In the corporate sector, easyJet (LON:EZJ) reported better-than-expected full-year operating profit, with the British carrier raising its medium-term target for holiday business after hitting the target early.
Compass Group (LON:CPG) forecasts profit growth of around 10% for fiscal year 2026 after exceeding annual earnings estimates, as the world's largest catering company benefits from new business growth in the United States, its largest market.
Kingfisher (LON:KGF), the European home improvement retailer, raised its full-year profit forecast as it reported a 0.9% increase in underlying sales for the third quarter, gaining market share in the UK.
A slight decrease in crude oil prices
Oil prices fell on Tuesday, weighed down by the prospect of a U.S.-brokered peace deal between Russia and Ukraine, which could lead to a return of Russian supplies to the global market.
Brent crude futures fell 0.6% to $62.32 a barrel, and U.S. West Texas Intermediate crude futures declined 0.7% to $58.49 a barrel.
Both crude oil benchmarks rose 1.3% during the previous session, but have suffered sharp losses in recent weeks amid growing concerns about an impending supply glut and slowing global demand.
