European stocks dip, French market cools

European stocks faced declines on Tuesday, influenced by French equities retracing gains from the previous session following initial relief over parliamentary election results.

The STOXX 600 index slipped 0.5 per cent to a two-week low as of 0704 GMT, while France’s CAC 40 index dropped 0.6 per cent after a 1.1 per cent rise on Monday.

Investor attention turned to eurozone inflation figures for June, anticipated to show a slight cooling compared to the previous month.

Recent data indicated German inflation for June fell more than anticipated, continuing a downward trend observed after two consecutive months of increases. This development has heightened speculation about potential further rate cuts by the European Central Bank (ECB) in September.

Despite these indicators, ECB President Christine Lagarde remarked on Monday that current economic conditions do not warrant immediate rate cuts. She highlighted benign economic developments influencing the central bank’s cautious approach.

Attribution: Reuters.