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Investing.com - European stocks traded in tight ranges Wednesday as investors digested the conclusion of the trade talks between China and the U.S., ahead of the release of crucial U.S. inflation data.
At 03:05 ET (07:05 GMT), the DAX index in Germany dropped 0.1%, while the CAC 40 in France gained 0.2% and the FTSE 100 in the U.K. rose 0.2%.
U.S./China trade framework
U.S. and Chinese officials have concluded two days of intensive negotiations in London, agreeing to a high‑level framework intended to revive the Geneva truce and address export control disputes.
The framework targets lifting China’s restrictions on rare earth mineral exports in exchange for the U.S. easing certain export curbs, especially on semiconductors.
However, details remain scarce, and the proposed agreement remains pending formal approval from Presidents Donald Trump and Xi Jinping.
Additionally, it remains unclear whether this truce would last any longer than the last one, creating the possibility of another trade war erupting again in the future.
U.S. CPI and U.K. Spending Review in focus
There is little in the way of economic data to study in Europe Wednesday, although U.K. investors will be keeping an eye on Chancellor Rachel Reeves as she delivers her latest Spending Review later in the session, setting out the budgets for all U.K. government departments over the next few years.
That said, most of Wednesday’s focus will be on the release of the U.S. consumer price index for May, amid concerns that the impact of the Trump administration’s tariffs will fan stagflationary fears.
The headline monthly rise is seen at 0.2%, while the core is seen up 0.3%, annual figures of 2.5% and 2.9%, respectively.
Attention is likely to be on whether tariffs show up in goods prices, though the full impact is likely to appear from June onwards.
The Federal Reserve is widely expected to hold rates unchanged next week amid tariff uncertainty, but an upward surprise could change the central bank’s interest‑rate path going forward.
Inditex has slow start to summer
In the corporate sector, Inditex (BME:ITX) will be in the spotlight, after the fast-fashion retailer missed expectations for its first-quarter sales, as well as reporting a slower start to its summer sales.
Fears of resurgent inflation and an economic slowdown triggered by tariffs have already dampened consumers’ enthusiasm for shopping in the United States and elsewhere.
In a statement, Inditex called its performance "solid", having labelled it "very robust" at its last results announcement in March.
Crude steady after trade talks
Oil prices steadied Wednesday, with traders digesting the outcome of crucial U.S.-China trade talks as well as the release of weekly U.S. crude inventories.
At 03:05 ET, Brent futures slipped 0.1% to $66.81 a barrel and U.S. West Texas Intermediate crude futures rose 0.1% to $64.99 a barrel.
Both benchmarks posted their highest levels since April during the previous session.
The prospect of a U.S.-China trade deal has helped reduce demand concerns, with free-flowing trade expected to boost global economic activity and thus crude demand.
The weekly U.S. oil inventories report from the Energy Information Administration is due later in the session, and follows the American Petroleum Institute reporting that crude stocks fell by 370,000 barrels last week.