European stocks mixed as global markets gear up for U.S. inflation data - CNBC

LONDON — European stocks were muted on Wednesday morning as investors prepare for the next reading of U.S. inflation due Thursday.

The pan-European Stoxx 600 hovered around the flatline in early deals, with travel and leisure stocks adding 0.5% while basic resources fell 0.5%.

The quiet open for European markets reflects cautious sentiment ahead of the latest inflation data from the U.S., which could lead the Federal Reserve to taper asset purchases sooner rather than later.

Read more: The Fed is in early stages of a campaign to prepare markets for tapering its asset purchases

The consumer price index for May is set to be released Thursday. Economists are expecting the CPI to rise 4.7% from a year earlier, according to Dow Jones. In April, the CPI increased 4.2% on an annual basis, the fastest rise since 2008.

The Fed has previously contended that higher price pressures are just temporary as the economy continues to rebound from the pandemic-induced recession.

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Meanwhile, shares in Asia-Pacific were mostly lower in Wednesday trade as investors reacted to the release of Chinese inflation data.

China's producer price index for May jumped 9% from a year earlier, against expectations in a Reuters poll for a 8.5% increase. The country's consumer price index in May rose 1.3% from a year earlier, lower than an expected 1.6% rise in a Reuters poll.

In other news, the World Bank upgraded its growth forecast on Tuesday with the global economy now expected to grow 5.6% in 2021. That compared against an earlier forecast in January for a 4% global economic expansion in 2021.

Still, the organization warned in a Tuesday press release that global output will be about 2% below pre-pandemic projections by the end of this year in spite of the recovery.

In terms of individual share price movement, Smith & Nephew climbed 4.4% in early trade to lead the Stoxx 600 after Credit Suisse upgraded the British manufacturer's stock to "outperform" from "neutral."

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