European Stocks Tumble Amid Inflation Woes and Corporate Setbacks

European stocks declined on Wednesday following disappointing corporate earnings and upcoming U.S. inflation data. Inditex saw a 5% drop due to weak sales, while the ECB is expected to cut rates. The political scenario in France and U.S. tariffs add further economic uncertainty.

European stocks continued their slide on Wednesday, retreating from multi-week highs after a series of uninspiring corporate earnings reports, while investors also eyed forthcoming U.S. inflation numbers. The STOXX 600 index was down 0.1% by 0922 GMT, marking its second consecutive day of decline after reaching a seven-week high on Monday.

Asian markets similarly paused ahead of anticipated U.S. inflation figures, with expectations keeping the Federal Reserve's rate-cutting trajectory intact. Market predictions put the likelihood of a 25-basis-point rate cut next week at 85%, according to CME's FedWatch tool. MUFG analysts suggested that while a cut seems probable, a stronger-than-expected CPI report could influence future guidance from the FOMC.

In corporate news, Inditex shares slid 5% following a rare third-quarter sales disappointment, although the company noted a positive start to the holiday shopping season. The broader retail index experienced a 2.3% drop, heading for its largest decline in over a month. Meanwhile, political developments in France and impending ECB rate decisions add to the economic complexities across Europe.

(With inputs from agencies.)