European Shares To See Cautious Start Ahead Of US Inflation Data

(RTTNews) - European stocks are seen opening little changed on Wednesday as investors await key U.S. consumer inflation data later in the day, which could impact the outlook for interest rates.

Consumer prices are expected to edge up by 0.2 percent in July after increasing by 1.3 percent in June. The annual rate of growth is expected to slow to 8.7 percent from a four-decade high of 9.1 percent.

China's consumer inflation accelerated in July to the highest level in two years, while producer price inflation slowed to 4.2 percent from 6.1 percent in June, data showed earlier in the day.

The consumer price index rose an annual 2.7 percent in the month, up from a 2.5 percent increase in June.

Destatis is slated to issue Germany's final consumer and harmonized index of consumer prices for July later in the day.

According to flash estimate, consumer price inflation eased slightly to 7.5 percent from 7.6 percent in June. The statistical office is set to confirm preliminary estimates.

Asian markets were broadly lower, with Hong Kong's Hang Seng index falling over 2 percent, dragged down by tech stocks.

Gold edged lower but hovered near one-month peak. The dollar index was largely unchanged and Treasury yields eased slightly, while oil traded weak around $90 a barrel.

U.S. stocks ended lower overnight as investors digested a batch of disappointing earnings reports and awaited inflation data for cues on the Fed's policy tightening path.

The tech-heavy Nasdaq Composite lost 1.2 percent, while the S&P 500 declined 0.4 percent and the Dow eased 0.2 percent.

European stocks closed broadly lower on Tuesday amid an uptick in bond yields and rising tensions over Taiwan. The pan European Stoxx 600 declined 0.7 percent.

The German DAX gave up 1.1 percent and France's CAC 40 index shed half a percent while the U.K.'s FTSE 100 finished marginally higher.