European equities tread water before Powell speech
European stock markets flatlined Friday before a key speech from Federal Reserve chief Jerome Powell, with sentiment dented by a deadly Kabul suicide attack.
London stocks turned flat approaching midday, while Frankfurt was also unchanged and Paris edged lower in early afternoon eurozone trade.
Investors will later digest a much-anticipated speech from Powell, who could outline plans for tapering monetary policy with some bank officials calling for a move within months.
His address to the annual Jackson Hole symposium of central bankers and economists will be closely watched for an idea about plans to reduce the bond-buying that has helped support the pandemic recovery, though a timetable is not yet expected.
"Stocks (are) expected to tread water for the rest of the day as we look towards Jackson Hole and today's speech by Fed chair Jerome Powell," said CMC Markets analyst Michael Hewson.
Analysts say the timing of the taper is crucial as it could also give an indication of when to expect interest rates to go up.
The cautious end to the week followed a drop on Wall Street, with sentiment also jolted by geopolitical concerns after a suicide attack at Kabul airport that left scores dead, including 13 US servicemen.
The bombings, claimed by the Islamic State group, left scenes of carnage outside the airport where thousands of Afghans desperate to flee their country had massed.
US President Joe Biden, under enormous pressure over his administration's handling of the Afghan crisis, has vowed to retaliate.
Oil prices, which have enjoyed a strong run this week after recent hefty selling, saw more big gains on Friday as traders bought into the view that the Delta Covid variant's spread will only delay the economic recovery and demand will continue to improve.
Analysts say WTI will likely hover around $68 a barrel until OPEC and other key producers signal their plans.
OPEC nations and their producer allies will hold their latest virtual output meeting next Wednesday.
"The OPEC+ meeting next week will be one to watch, with prices once again elevated and following suggestions from the White House recently that the group should be increasing production faster," said OANDA analyst Craig Erlam.
"While the group won't bow to pressure from the White House, some members may agree with the United States which could make for interesting discussions."
Earlier, Tokyo shares opened higher Wednesday on rekindled hopes that the worst is over for the current wave of Covid infections, with the renewed optimism sending Wall Street to record finishes.
The benchmark Nikkei 225 index rose 0.17 percent, or 48.28 points, to 27,780.38, while the broader Topix index gained 0.21 percent, or 4.07 points, to 1,938.27.
The dollar stood at 109.73 yen, up from 109.66 yen in New York Tuesday.
The gains in early trade in Tokyo came after Wall Street shares firmed amid hopes that the US is moving towards economic normalisation, as businesses report solid earnings and recent economic data suggests a brighter future ahead.