European stocks may open higher on Tuesday as investors await testimony from Federal Reserve Chair Jerome Powell for clues as to when the central bank's easy monetary policy stance will start to change.

In his testimony today and tomorrow, Powell will probably play down the risk of a runaway inflation despite the size of President Joe Biden's $1.9 trillion coronavirus relief proposal.

The stimulus package advanced out of the House Budget Committee on Monday and is virtually set for a full House vote later this week.

Asian markets are trading mixed as rising U.S. Treasury yields and inflation prospects unsettled investors. The dollar nursed losses while gold steadied after two days of gains.

Oil extended overnight gains on a tight global supply outlook. Investors expect that an approaching meeting of top crude producers will likely keep output largely in check.

Top cryptocurrencies plunged with bitcoin plummeting over 8 percent to tumble below the $53,000 level after U.S. Treasury Secretary Janet Yellen warned that Bitcoin is a highly speculative asset and extremely inefficient for conducting transactions.

U.S. stocks fell broadly overnight as rising commodity prices and climbing government bond yields stoked worries about inflation and valuations, just as the world starts to bounce back from the coronavirus pandemic.

The Dow Jones recovered from an early slide to end 0.1 percent higher, while the S&P 500 shed 0.8 percent and the tech-heavy Nasdaq Composite tumbled as much as 2.5 percent.

European markets closed slightly lower on Monday as the reflation trade emerged as a key theme.

The pan European Stoxx 600 shed 0.4 percent. The German DAX dropped 0.3 percent, the U.K.'s FTSE 100 slid 0.2 percent and France's CAC 40 index dipped 0.1 percent.

(Source:RTT News)