LONDON – European stocks were mixed on Thursday morning as global markets brace for the latest US inflation data.
The pan-European Stoxx 600 hovered around a fixed line in early trading, with cars down 1% and healthcare stocks up 0.6%.
Global markets are largely focused on US inflation data due out on Thursday, which could be critical for the Federal Reserve’s schedule to raise interest rates or tighten its asset-buying program.
Asia Pacific equities were higher in trading on Thursday, and futures contracts, tied to major US stocks, were mixed in early premarket trading.
The Labor Department plans to release CPI data at 8:30 am ET Thursday. Economists surveyed by Dow Jones expect the May CPI report to show a 4.7% year-on-year rise in prices after rising 4.2% in April.
The Federal Reserve is trying to assess if the higher price pressures are temporary as the economy continues to recover from the downturn caused by the pandemic.
For weeks, investors have been worried about whether the surge in inflation could prompt the Fed to limit the pace of asset purchases or start signaling interest rate hikes. However, some say these fears are premature and that the central bank will give markets enough time before it takes any action.
Investors in Europe are also gearing up for the next European Central Bank meeting on Thursday, and most expect the central bank to continue to step on the stimulus.
Many believe that the ECB will stick to its current course because of the uncertain economic outlook and to avoid unwanted tightening of financial conditions.
Read More: European Central Bank Expected to Continue Stimulating Growth Despite Inflation Concerns
At Thursday’s meeting, the ECB will also update its quarterly staff forecasts for inflation and growth, along with its traditional rate decision and press conference. The interest rate decision will be announced at 12:45 pm London time.
In other news, British Prime Minister Boris Johnson will meet with his American counterpart Joe Biden on Thursday ahead of the G7 Summit in Cornwall, which kicks off Friday.
In terms of individual share price dynamics, shares of British auto trader Auto Trader and French semiconductor manufacturer Soitec climbed more than 5% after strong earnings and upbeat outlooks for the year, respectively.
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– Thomas Frank and Annette Weisbach of CNBC contributed to this market survey.