European stocks mixed; German wholesale prices slip, Chinese property woes rise

European stock markets traded in a mixed fashion Monday, as investors digested better-than-expected German inflation numbers as well as persistent concerns about Chinese economic growth.

At 03:45 ET (07:45 GMT), the DAX index in Germany traded 0.1% higher, while the CAC 40 in France dropped 0.1% and the FTSE 100 in the U.K. fell 0.4%.

German wholesale prices show signs of improvement

On Monday, European investors got a slight uplift after German wholesale prices experienced a 0.2% decrease on a monthly basis in July. This surpasses the anticipated drop of 1.4%, suggesting some robustness in the hard-hit German economy. However, the overall picture shows a yearly decline of 2.8%, indicating the challenges the eurozone's leading economy faces. This includes the challenging combination of poor trade relations with main associate China, and a downturn in its significant manufacturing and construction industries.

Additionally, the possibility of U.S. interest rates rising further after Fridays stronger-than-expected producer price index will act as a drag on the global economy.

The reading, which came after data also showed an increase in consumer inflation, pushed up concerns that the Federal Reserve will keep hiking when it next meets in September.

Concerns surrounding Chinas property sector weigh

There also remain worries about China's debt-laden property sector.

Country Garden (HK:2007), one of the countrys biggest developers, warned of a hefty $7.6 billion loss in the first half of 2023, prompting sharp selling to a new record low on Monday.

The company is also facing difficulty in meeting its debt obligations, having suspended trading in 11 of its onshore bonds, prompting fears of a default and more headwinds for the countrys economic recovery from its COVID hit.

China has the second-largest economy in the world, and is a major regional growth driver as well as a massive market for Europes largest companies.

U.S. retail sector dominates quarterly earnings

There are few tier-one companies scheduled to report earnings in Europe Monday, but Philips (AS:PHG) stock climbed over 4% after Dutch investment firm Exor (AS:EXOR) took a 15% stake in the healthcare company.

Most of the corporate attention this week is likely to be focused on the U.S. retail scene.

A number of the largest U.S. retailers are set to report their results, which will give investors an important insight into the health of consumer spending, a major driver of the U.S. economy.

Crude falls on rising dollar, China concerns

Oil prices retreated Monday, as concerns about Chinas faltering economic recovery as well as a stronger dollar prompted profit-taking after seven weeks of gains on tightening supply from OPEC+ output cuts.

Fridays U.S. producer price index release saw the dollar climb to a five-week high, which hurts demand for crude as it makes the commodity more expensive for international buyers.

By 03:45 ET, U.S. crude futures traded 1.1% lower at $82.30 a barrel, while the Brent contract dropped 1% to $85.97.

Additionally, gold futures traded largely flat at $1,946.85/oz, while EUR/USD edged higher to 1.0946.