- German retail sales rise
- Eurozone inflation slows
- UK mortgage approvals fall
- US and Russia hold talks
FTSE 100: 0.16%
CAC 40: -0.22%
FTSE MIB: 0.60%
IBEX 35: 0.22%
Stoxx 600: 0.13%
European stocks were mixed after reports showed German retail sales rose and Eurozone inflation slowed.
German retail sales rose 2% in February compared to a year ago following a 0.9% increase a month earlier, surprising analysts who had predicted a 0.8% gain.
The Eurozone consumer price index (CPI) rose at an annual rate of 0.5%, moving down from February's reading of 0.8% growth and settling below the consensus forecast for a 0.6% increase.
The further fall in inflation could put pressure on the European Central Bank ahead of its policy decision on Thursday. The ECB, which is targeting inflation of just below 2%, is forecast to keep interest rates at 0.25% this month.
Germany's Ministry of Finance expects the ECB to hike interest rates next year thanks to the economic recovery, according to a Der Spiegel report published on Sunday that quoted an "internal document".
While it is predicted the ECB will hold fire on interest rates, there is growing speculation that it will implement monetary stimulus in order to ward off deflation risks.
However, Bundesbank President Jens Weidmann said at a conference on Saturday that the Eurozone was not in a deflationary cycle and that the ECB shouldn't overreact to the temporary slowdown in prices, according to Reuters.
UK mortgage approvals, US data
UK mortgage approvals fell to 70,309 in February, in comparison to 76,753 a month earlier (consensus: 75,000).
In the US this afternoon, attention will turn to the Chicago purchasing managers' index for manufacturing, which economists forecast will come in at 59.5 in March, down from 59.8 a month earlier.
A separate report on US manufacturing activity from the Dallas Federal Reserve is anticipated to rise to 2.5 in March from 0.3 in February.
Federal Reserve Chair Janet Yellen will also speak at the Development Conference in Chicago.
Ukraine tensions flare
US Secretary of State John Kerry said on Sunday he believes Moscow has created "fear and intimidation" in Ukraine following talks with his Russian counterpart, Sergei Lavrov, in Paris.
Kerry said progress would come once Russia pulls troops from the Urkaine border. He also said the US still considered Russia's annexation of Crimea from Ukraine to be "illegal and illegitimate".
Babcock rises on UK government deal
Babcock gained after the UK government named the engineer as one of the preferred bidders to manage the decommissioning of nuclear sites.
Rio Tinto and Anglo American advanced after Credit Suisse named the companies as its top picks in the metals and mining sector.
Novartis rallied after the Swiss drugmaker said the final phase of a clinical trial showed a treatment for chronic heart failure helped patients live longer.
Banca Monte dei Paschi di Siena SpA edged higher after its biggest investor, the Monte dei Paschi foundation, said it is selling an additional 3% stake in the Italian lender.
The euro rose 0.28% to $1.3791.
Brent crude futures fell $0.204 to $107.850 per barrel, according to the ICE.