(Alliance News) - European stock markets are expected to open higher Wednesday despite tepid inflation data from China doing little to assuage fears about the weak pace of the world's second-largest economy's post-covid rebound.

China has slipped into deflation, with consumer prices contracting last month for the first time in more than two years, official data showed, as slowing domestic spending weighs on the economic recovery. The consumer price index fell 0.3 percent in July, the National Bureau of Statistics said, after remaining flat in June. Analysts surveyed by Bloomberg had forecast a 0.4 percent drop.

In Asia on Wednesday, the Nikkei 225 index in Tokyo fell 0.4 percent. In China, the Shanghai Composite is in the red by 0.6 percent, while Hong Kong's Hang Seng Index trades down 0.4 percent.

The FTSE Mib is advancing 375.00 points after closing down 2.1 percent at 27,942.25 last night.

Paris' CAC 40 is advancing 64.20 points, Frankfurt's DAX 40 is up 105.00 points, and London's FTSE 100 is advancing 42.70 points.

Among the smaller listings on Tuesday, the Mid-Cap gave up 1.0 percent to 41,478.30, the Small-Cap finished down 0.8 percent to 26,675.84, and Italy Growth gave up 0.7 percent to 8,858.77.

On the Mib last night, with a bearish majority, banks hurt after the government's "extra profits" initiative. BPER Banca closed down 11% as did MPS, FinecoBank ended the day down 9.9%, Banco BPM contracted 9.1% preceded by Intesa Sanpaolo, Banca Mediolanum and UniCredit in the red 8.7%, 6.0% and 5.9%.

Also down were Banca Generali and Mediobanca, marking minus 3.2% and 2.5%.

On the other side of the list, Recordati took the lead with 2.5 percent followed by Telecom Italia, which closed up 2.2 percent. According to the Sole 24 Ore website, U.S. fund KKR has brought in CPPIB, Canada's largest public pension fund, "which manages a total of EUR400 billion," to participate in the investment in Netco.

Terna - up 0.6 percent - and Steg, the Tunisian electricity and gas company, signed the Grant Agreement with the European Commission that kicks off the EUR307 million financing earmarked for the electricity interconnection between Italy and Tunisia, the invisible energy bridge, dubbed "Elmed," that will link Europe and North Africa.

On the Mid-Cap, Sanlorenzo closed on top with a rise of 2.9 percent. illimity Bank followed in the green by 2.8 percent while the other banks also suffered on this list.

Credito Emiliano ended at the bottom and gives up 8.3 percent, Banca Popolare di Sondrio is down 5.7 percent, BFF Bank 3.2 percent, and Banca Ifis finished 2.2 percent in the red.

Of note, on Tuesday afternoon the board of Banca Popolare di Sondrio reviewed and approved the consolidated half-year financial report as of June 30 with a record net profit of EUR207.1 million from EUR105.0 million in the same period last year.

Net interest income amounted to EUR427.0 million up from EUR320.0 million in the first half of 2022.

Results also for Credem, which on Monday approved consolidated results for the first half of the year, a period closed with consolidated net income at EUR298.7 million from EUR157.0 million in 2022. Credem points out that it expensed EUR25 million in contributions to funds for the management of troubled banks in that perid. The result is up 90 percent from the same period last year.

Webuild closed down 2.9 percent. On Monday it reported having bought 550,000 of its own ordinary shares in the week of July 31 to August 3.

The average price was EUR1.7603 per share, for a total value of EUR968,137.64.

On the Small-Cap, SS Lazio closed 2.4 percent in the red after announcing on Tuesday that it had finally acquired the sports contract rights of footballer Gustav Tang Isaksen from FC Midtjylland for a consideration of EUR12 million to be paid in three equal installments plus bonuses linked to the achievement of particular sports results up to a maximum of EUR4 million.

Greenthesis - tied at EUR0.89% - through its wholly owned subsidiary under Emirates law Ambienthesis Middle East DMCC, on Monday announced that it has been appointed to carry out characterization activities, in the amount of approximately EUR100,000, functional to the subsequent remediation of hydrocarbon-contaminated soil to be carried out in the Abu Dhabi industrial area.

Pierrel - flat at EUR157 per share - announced Monday that it has obtained marketing authorization in Ecuador for its Articaine-based dental anesthetic, Orabloc in the 1:100,000 formulation.

With the registration in Ecuador, Orabloc makes its entry into South America.

The board of directors of AbitareIn -- in the red by 0.8 percent -- on Monday approved results for the third quarter ended June 30 in which it reported a consolidated profit of EUR22.9 million from EUR5.7 million in the same period a year earlier.

Among SMEs, Mondo Tv France -- up 1.8 percent -- announced Tuesday the signing of an agreement with the AIDA Foundation that provides an exclusive license to produce an original musical inspired by the new series Grisù.

SIF Italia and Visibilia Editore did well, closing up 15 percent and 36 percent, respectively.

In New York on the European night, the Dow Jones closed down 0.5 percent, the S&P gave up 0.4 percent, and the Nasdaq finished 0.8 percent in the red.

Among currencies, the euro changed hands at USD1.0972 versus USD1.0970 in Tuesday's European stock close while the pound was worth USD1.2764 from USD1.2731 Tuesday evening.

Among commodities, Brent crude is worth USD85.97 per barrel versus USD85.20 per barrel at last night's close. Gold, on the other hand, trades at USD1,929.25 an ounce from USD1,925.83 an ounce Tuesday night.

On Wednesday's economic calendar, there are Gilt auctions in the UK at 1100 CEST and Bund auctions in Germany at 1130.

In the afternoon, from the U.S., mortgage data are scheduled at 1300 CEST while crude oil stocks will come out at 1630 CEST.

On the Piazza Affari calendar, the results of Assicurazioni Generali, Emak and Laboratorio Farmaceutico Erfo will come out.

By Maurizio Carta, Alliance News reporter

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