- Strong euro a threat to Eurozone, says Draghi
- Yellen to deliver testimony
- UK inflation data due
- US retail sales report to be released

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Stocks in the euro-area were little changed as investors digested remarks from European Central Bank (ECB) President Mario Draghi and awaited a testimony from Federal Reserve Chair Janet Yellen.

Draghi yesterday reiterated that a stronger euro exchange rate is a risk to the sustainability of the Eurozone recovery.

"Certainly, the appreciation that took place since mid-2012 had an impact on price stability," Draghi told the European Parliament's Committee on Economic and Monetary Affairs in Strasbourg.

He also said that large-scale purchases of public and private debt fall "squarely" within the ECB's mandate to keep inflation low and stable.

Turning to today's agenda, Yellen will deliver her testimony to the Senate Banking Committee which may provide some clues as to the central bank's next move. The market will be looking for hints on the first interest rate hike.

In other US news, a report may show retail sales rose 0.6% year-on-year in June, after increasing 0.3% the previous month, according to estimates by analysts.

In the UK early on, the consumer price index is forecast to have climbed 1.6% in June compared to a year ago, after rising 1.5% a month earlier, closer towards the Bank of England's (BoE) target of just under 2%.

BoE Governor Mark Carney will be questioned by lawmakers following the release. He will appear at Treasury Committee on June Financial Stability Report alongside the BoE's Deputy Governor Andrew Bailey, Donald Kohn and Martin Taylor.

Meanwhile, ZEW will release economic sentiment surveys on the Eurozone and Germany.

"Unfortunately, despite the World Cup win, German fortunes remain weak in the economic sphere, with poor factory orders, retail sales and unemployment claims pointing towards a slowdown in the region," said Joshua Mahony, analyst at Alpari UK.

"Much of this has been expected given the extraordinarily strong Q1 that they seemed to have. However, if there is one thing that the Eurozone does not want it is a weak German economy pulling down growth."

Software, Draegerwerk

Software declined after saying the margin on full-year operating profit may be as little as 26%.

Draegerwerk retreated after the German maker of medical equipment lowered its 2014 sales growth estimate to 2-4% from 3-6%.

Gjensidige Forsikring gained after saying profit climbed more than analysts had estimated.

Hennes & Mauritz advanced as Europe's second-biggest clothing retailer said sales increased 12%in June, ahead of the 9.4% gain expected by analysts.

The euro fell 0.03% to $1.3615.

Brent crude futures dropped 0.309% to $106.65 per barrel, according to the ICE.

RD

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