Investing.com - European stock markets traded in a mixed fashion Thursday, as investors digested regional inflation data with key central bank policy meetings drawing nearer.
At 03:30 ET (07:30 GMT), the DAX index in Germany traded 0.4% higher, the FTSE 100 in the U.K. rose 0.1%, while the CAC 40 in France dropped 0.1%.
The month of August is coming to end, and it has been a difficult one for investors as the eurozone has struggled with a sharper-than-expected contraction in business activity.
The DAX is on course for a monthly loss of 2.2%, the CAC 40 is currently down 0.6%, while the FTSE 100 is 2.5% lower.
Eurozone CPI data eyed
Investors are focusing on the release of preliminary eurozone consumer inflation data for August, as the next policy-setting meeting of the European Central Bank draws nearer.
Data from Germany and Spain on Wednesday suggested that inflation was slowing at a disappointingly sluggish pace.
Additionally, data released earlier Thursday from France saw consumer prices rise 1.0% on the month in August, an annual gain of 4.8%, way ahead of expectations.
The eurozone CPI is expected to rise 5.1% on an annual basis in August, a slight cooling from July’s 5.3%, but the data from the major member states point to potential upside.
ECB President Christine Lagarde hinted that the region’s central bank will pause its rate-hiking cycle in September at the press conference that followed its last meeting, but this is now in doubt.
German retail sales slumped 0.8% on the month in July, an annual drop of 2.2%, data showed earlier Thursday, illustrating the damage the ECB’s aggressive monetary policy tightening was having on the region’s largest economy.
U.S. inflation data also in spotlight
Across the pond, softer data from the U.S. economy this week has bolstered market expectations that the Federal Reserve will pause its rate-hiking cycle in September, at least for a month.
The core PCE number for July is due later in the day, and is expected to show a small 0.2% increase from the previous month, while estimates put annual core numbers at 4.2%, up from 4.1%.
UBS to absorb Credit Suisse’s domestic bank
In corporate news, UBS (SIX:UBSG) stock soared over 6%, climbing to the highest level since October 2008, after the Swiss banking giant said it would fully absorb Credit Suisse (SIX:CSGN)'s domestic bank, deciding against spinning off the business, while increasing its expectations for cost savings to over $10 billion.
"Our analysis clearly shows that a full integration is the best outcome for UBS, our stakeholders and the Swiss economy," Chief Executive Sergio Ermotti said in a statement.
Crude steadies after Chinese PMIs, U.S. inventories draw
Oil prices traded largely unchanged Thursday, as traders digested the conflicting influences of disappointing business activity data from China, the world’s biggest crude importer, and a substantially bigger-than-expected draw in U.S. crude inventories.
The Energy Information Administration reported Wednesday that U.S. oil inventories shrank by 10.6 million barrels last week, substantially above the 3.3 million barrels expected, as refiners ramped up production before the Labor Day weekend, which usually signals peak U.S. summer demand.
Markets were also watching for any more disruptions in production stemming from Idalia, which made landfall in Florida on Wednesday, and has since been downgraded from hurricane status back to a tropical storm.
By 03:30 ET, the U.S. crude futures traded 0.1% higher at $81.67 a barrel, while the Brent contract traded largely flat at $85.22. Both contracts were set to break a two-week losing streak, but were also set for minor gains in August.
Additionally, gold futures fell 0.1% to $1,972.05/oz, while EUR/USD traded 0.3% lower at 1.0897.