Europe open: Markets subdued as investors watch incoming data

European stock markets were once again rangebound on Thursday morning as investors treaded with caution in light of yet more incoming economic data, which could give more clues on the short-term outlook for interest rates.

A whole host of service-sector purchasing managers' indices (PMIs) are due out across the continent on Thursday, including figures from Spain, Italy, France, UK and Germany.

Meanwhile, numbers released by the Swiss Federal Statistical Office showed that inflation in Switzerland fell to its lowest level in two and a half years. The annual increase in the consumer price index slowed to just 1.0% in March, down from 1.2% in February and below the 1.3% expected by the market.

That followed a downside surprise in the eurozone CPI reading released on Wednesday, which showed the annual inflation rate easing to 2.4% in March from 2.6% in February.

The Stoxx 600 index was up just 0.1% early on at 510.56, with gains of just 0.1% to 0.3% seen across most major equity indices. The pan-European benchmark has been trading within a tight range over the past week after having reached another all-time closing high of 512.67 on 28 March.

“Interest rate intrigue continues to hover, with the many variables leading investor sentiment in different directions," said Richard Hunter, head of markets at Interactive Investor.

"Only last week there was an increasing conviction that rate cuts from the Fed, ECB and Bank of England would converge and all take place in June. Since then, the possibility of the ECB moving first has been accompanied by increasing debate over whether the other two central banks may delay their first move.”

In equity news, Mondi shares were 4% lower in London after DS Smith extended its deadline for the UK packaging group to make a revised takeover offer by two weeks. Mondi and DS Smith had tentatively agreed on a deal last month, only to be outbid by US rival International Paper last week.

Also in London, media group Future surged 12% as it reported a return to organic revenue growth in the second quarter, largely attributed to robust performances in Go.Compare, B2B sectors, and resilient magazine sales.

French luxury giant Kering edged 0.4% lower on the news it is spending $1.4bn on a historic building in Milan's fashion district.