**European Stocks Retreat from Peaks as Inflation Data Looms**
European stock markets stepped back from their recent zeniths on Monday, with the pan-European STOXX 600 and other major indexes slipping from record highs. The downturn mirrored a similar retreat on Wall Street, where U.S. stocks also edged lower amid a climate of economic uncertainty and anticipation of upcoming U.S. inflation figures.
The MSCI World Equity index, which tracks shares in 47 countries, declined by 0.3 percent at 1236 GMT after reaching a new all-time high last Friday. The STOXX 600 wasn’t far behind, experiencing a 0.5 percent drop from its own record-setting performance.
In the United Kingdom, the FTSE 100 index saw a decrease of 0.5 percent, while Germany’s DAX index fell by 0.7 percent. This pullback comes after U.S. stocks began to descend from their lofty heights last Friday, a move that analysts have largely attributed to profit-taking following mixed signals from U.S. payrolls data.
Despite the data, expectations for a Federal Reserve rate cut in June have persisted. Now, all eyes are on the U.S. inflation data set to be released on Tuesday, which could significantly influence the timing of interest rate adjustments by major central banks.
Amelie Derambure, a senior multi-asset portfolio manager at Amundi, suggested that Monday’s downturn might be a reaction to the unclear economic outlook and the stretched valuations in equity markets. “There are some elements on the macro outlook that are maybe not as clear as one was willing to believe,” she commented.
Last week’s remarks from Federal Reserve Chair Jerome Powell and European Central Bank policymakers had fueled investor optimism for rate cuts starting this summer, propelling stock indexes to new highs. However, with the latest economic indicators and forthcoming inflation data, traders appear to be recalibrating their expectations.
Investors and market watchers will continue to monitor the situation closely as they navigate through these uncertain times. Stay updated with the latest market trends by following the Cyprus Mail on Google News.
