European stock markets are expected to have a muted open on Wednesday as markets shift their focus on Brexit negotiations taking place between British and EU officials. Ahead of the upcoming EU summit later this week, teams from both sides are burning the midnight oil as they desperately try to resolve their differences and work out a deal, with just a couple of weeks to go for the deadline.

In the Asian session earlier today, stock markets in Asia traded bullish over news reports that suggested Britain and the EU were ‘on the brink of a deal’, but caution runs high in markets as the European session gets underway shortly. Markets could hope to see a draft deal emerge as soon as today if the UK has given in to the EU’s demands on the Irish border issue.

Meanwhile, US-China trade tensions are threatening to impact stock markets and financial markets all over again after the US House of Representatives passed a legislation in reaction to the Hong Kong protests. China’s Foreign Ministry has threatened possible retaliation in case the US passes the bill to downgrade Hong Kong’s special trading status on account of the protests. This has markets worried over a possible spillover effect on the ongoing trade negotiations as the US and China work towards a Phase 1 trade deal.