A look at the day ahead in European and global markets from

Stella Qiu

So, President Donald Trump said we may need to wait two

more weeks until he decides whether to launch a U.S. attack on

Iran. In the meantime, markets are mostly breathing a sigh of

relief but remain cautious over conflict in the Middle East.

Brent crude oil prices fell 2.5% on Friday, erasing some of

their recent gains but still on track for a 3.7% weekly rise, up

for a third straight week.

Falling oil prices appear to have given European stocks a

reason to cheer, with EUROSTOXX 50 futures rising 0.7%

and FTSE futures up 0.3%. Nasdaq futures and S&P

500 futures were both 0.2% lower.

Some analysts have pointed to Trump's two-week deadlines for

other key decisions, including in letters to U.S. trade partners

on tariff negotiations, and the hope is that Tehran in the

interim will be pressured to come to the negotiating table.

Stocks were mixed in Asia on Friday, with Japan and

Australia falling while China was higher. South Korea's share

benchmark outperformed with a jump of 1.1%, topping the

3,000 level for the first time since early 2022, after newly

elected President Lee Jae Myung announced a stimulus spending

plan.

The U.S. dollar was also on the back foot, although it is

set for a weekly gain of 0.5% on safe-haven flows spurred by the

Middle East conflict. Still, one week of gains would not reverse

the recent declining trend and many analysts expect the dollar's

losses have further to run.

China kept its benchmark lending rates unchanged on

Friday as widely expected while data from Japan showed core

inflation at a two-year high, keeping pressure on the Bank of

Japan to hike rates again. Investors, however, doubt that such a

move would come before December.

Overnight, a number of central banks in Europe sent out

dovish signals, including Norway's central bank which delivered

its first rate cut since 2020. The Swiss National Bank cut rates

to zero and did not rule out going negative, while the Bank of

England held policy steady but saw a need for further easing.

Key developments that could influence markets on Friday:

-- Germany PPI data for May

-- UK retail sales data for May

-- ECB releases its economic bulletin