European Shares Set For Positive Start

European stocks may open higher on Friday, tracking gains in U.S. stock futures after Russia announced a new drawdown of military forces from the Moscow-annexed Crimean peninsula and the U.S. Secretary of State agreed to a meeting with Russia’s foreign minister, raising hopes for a diplomatic resolution.

Separately, the G7 nations are ready for “a serious dialogue” with Russia on the Ukraine crisis, German Foreign Minister Annalena Baerbock said today on the eve of crunch talks in Munich with her G7 counterparts.

Asian markets were mostly lower but came off their day’s lows after the latest Ukraine updates.

Bond yields fell and dragged the dollar lower while gold eased slightly after breaking past $1,900/oz for the first time since June 11 on Thursday.

Oil extended overnight losses and headed for a weekly fall after the United States said that “substantial progress” during negotiations in Vienna to save the Iran nuclear deal had been made.

Retail sales data from the U.K. is due later in the session, headlining a light day for the European economic news.

Across the Atlantic, readings on existing home sales and leading economic indicators are due.

Fed officials Charles Evans, Christopher Waller and Lael Brainard are due to speak at the U.S. Monetary Policy Forum later in the day.

St. Louis President James Bullard cautioned on Thursday that without action on interest rates, inflation could get out of control.

Fed Bank of Cleveland President Loretta Mester also supported raising interest rates at a faster pace to douse raging inflation.

U.S. stocks sank overnight after Ukrainian forces and pro-Moscow rebels traded fire in eastern Ukraine and top U.S. leaders insisted that a Russian invasion of Ukraine is imminent.

Adding to the concerns, the State Department said Russia has expelled the deputy chief of the U.S. diplomatic mission in Moscow without any justification.

The Dow dropped 1.8 percent, the tech-heavy Nasdaq Composite index plunged 2.9 percent and the S&P 500 shed 2.1 percent.

European stocks ended lower on Thursday as developments in Ukraine added to uncertainty over the future course of inflation.

The pan European Stoxx 600 declined 0.7 percent. The German DAX gave up 0.7 percent, France’s CAC’40 index eased 0.3 percent and the U.K.’s FTSE 100 fell 0.9 percent.

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