European Shares Set For Tepid Start As US Inflation Data Looms

(RTTNews) - European stocks are seen opening a tad lower on Tuesday as investors brace for key U.S. inflation data for important clues on the economic and rate outlook.

The U.S. producer price inflation report is likely to be in the spotlight today along with Fed Chair Jerome Powell's remarks during a moderate discussion with De Nederlandsche Bank President Klaas Knot.

Economists expect producer prices to rise by 0.3 percent in April after edging up by 0.2 percent in March, while the annual rate of growth is expected to tick up to 2.2 percent from 2.1 percent.

The consumer price inflation is due on Wednesday and economists expect prices to climb by 0.4 percent in April, matching the increase seen in March.

The annual rate of consumer price growth is expected to dip to 3.4 percent in April from 3.4 percent in March, while the annual rate of core consumer price growth is expected to slow to 3.6 percent from 3.8 percent.

Closer home, German ZEW survey results and British wage data may garner investor attention later in the day.

Asian markets were narrowly mixed this morning, the dollar held steady, and gold edged up while oil prices were little changed before the release of OPEC's market outlook. In the Middle East, the UN has said that about 20 percent of Gaza's population has been displaced in the past week due to intensified Israeli military operations.

U.S. stocks closed mixed overnight ahead of key inflation reports and Fed Chair Jerome Powell's speech scheduled for later in the week.

In economic news, a New York Federal Reserve survey found that consumers are bracing for a year of rising inflation and less income.

Federal Reserve Vice-chair Phillip Jefferson called for holding rates steady at current levels until inflation moderates back to the 2 percent target.

The Dow dipped 0.2 percent to snap an eight-day winning streak and the S&P 500 finished marginally lower while the tech-heavy Nasdaq Composite edged up 0.3 percent. European stocks closed mostly lower on Monday after smashing records last week. The pan European STOXX 600 ended flat with a positive bias.

The German DAX and the U.K.'s FTSE 100 both slid around 0.2 percent while France's CAC 40 eased 0.1 percent.