European stocks drift lower awaiting Bernanke

Europe's stock markets mostly retreated on Tuesday as traders weighed conflicting European data but mainly awaited testimony from US Federal Reserve chief Ben Bernanke. London's FTSE 100 index of leading shares was unchanged at 6,586.23 points in afternoon trading. Frankfurt's DAX 30 fell 0.29 percent to 8,210.87 points and in Paris the CAC 40 decreased 0.66 percent in value to 3,852.69. In Britain, which is a member of the European Union but not the single-currency eurozone, annual inflation hit a 14-month peak in June, official data showed on Tuesday. Consumer Prices Index (CPI) inflation jumped to 2.9 percent in June from 2.7 percent in May, driven by rising petrol prices and shallower discounts from clothing and footwear retailers, the Office for National Statistics said in a statement. That was the highest level since April 2012 but was lower than market expectations for 3.0 percent, according to analysts polled by Dow Jones Newswires. Separately, eurozone inflation rose to 1.6 percent in June from 1.4 percent in May, EU data agency Eurostat said on Tuesday, with the figure for powerhouse Germany jumping from 1.6 to 1.9 percent. Meanwhile investors in Germany, Europe's biggest economy, turned gloomy this month, as disappointing economic data appeared to cast a shadow over the recovery outlook, a new survey found. The widely watched investor confidence index calculated by the ZEW economic institute fell by 2.2 points to 36.3 points in July, disappointing analysts' forecasts for an increase to around 40 points this month. German investors apparently took little cheer from a recent pledge by the European Central Bank to keep eurozone interest rates low for the foreseeable future. They fretted instead about the fallout for exports from the slowing Chinese economy. China's economic growth slowed to a 7.5 percent pace in the April-June quarter, down from 7.7 percent in the previous three months, its government said on Monday. The slower growth rate came in as expected, which analysts said might explain the lack of impact on markets. Meanwhile, the euro rose to $1.3117 from $1.3064 late in New York on Monday. The dollar fell to 99.52 yen from 99.82 yen. The price of gold grew to $1,286 an ounce from $1,284.75 Monday on the London Bullion Market. US stocks also opened flat Tuesday as strong second-quarter earnings report from Goldman Sachs was offset by a sagging performance from Coca-Cola. Five minutes into trade, the Dow Jones Industrial Average was up 0.04 percent, while the tech-rich Nasdaq Composite picked up 0.07 percent at 3,609.94. Asian stock markets mainly closed higher on Tuesday, taking their lead from Wall Street after the Dow and S&P 500 indices closed overnight at record highs for a third straight session despite weak US retail sales figures. The focus was soon to turn to Bernanke and his testimony on the US economy and monetary policy due on Wednesday and Thursday. Dealers will be hoping for more clues about the future of the Fed's huge bond-buying scheme. Bernanke said recently that the US central bank would maintain its growth-oriented policies "for the foreseeable future" but some analysts expect the $85 billion-a-month stimulus programme to be wound down from the end of the year.