European markets head for slightly higher open amid mixed global sentiment

• European stocks are expected to open slightly higher on Wednesday, reflecting a more cautious and uncertain tone among global markets.
• London's FTSE is seen opening 7 points higher at 7,102, Germany's DAX 16 points higher at 15,512, France's CAC 40 up 10 points at 6,503 and Italy's FTSE MIB down 4 points at 25,110, according to IG.

LONDON — European stocks are expected to open slightly higher on Wednesday, reflecting a more cautious and uncertain tone among global markets.

London's FTSE is seen opening 7 points higher at 7,102, Germany's DAX 16 points higher at 15,512, France's CAC 40 up 10 points at 6,503 and Italy's FTSE MIB down 4 points at 25,110, according to IG.

The more cautious open expected in Europe reflects mixed sentiment elsewhere overnight; shares in Asia-Pacific were mixed in Wednesday trade following losses on Wall Street, with the S&P 500 ending its seven-day winning streak in the previous session.

Investors may be worried the economy might be approaching its peak and that a correction could be on the way. In addition to complacency in the market, the combination of profit-margin pressures, inflation fears, Fed tapering and possible higher taxes could contribute to an eventual drawdown, market strategists say.

In the U.S. on Tuesday, recovery-centered stocks like Caterpillar, Chevron and JPMorgan Chase pulled back while Big Tech stocks like Amazon, Apple and Alphabet gained. Energy stocks took a hit after West Texas Intermediate crude futures hit their highest level in more than six years before turning negative.

Oil prices were mildly higher on Wednesday afternoon in Asia following the plunge Tuesday, with international benchmark Brent crude futures marginally higher at $74.55 per barrel. U.S. crude futures advanced 0.12% to $73.46 per barrel.

Volatility in the oil market follows an indefinite postponement of talks between OPEC and its oil-producing allies after the group failed to reach an agreement on its output policy for August and beyond.

On the data front, Russia releases inflation data for June and France releases trade data for May. There are no major earnings releases Wednesday.

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– CNBC's Tanaya Macheel contributed reporting to this story.

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