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European Markets Close Lower as Investors Prepare for More U.S. Inflation Data

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  • European stocks closed lower on Monday as investors prepare for more key inflation data out of the U.S. this week.
  • The pan-European Stoxx 600 index provisionally ended 0.5% lower, with most sectors and major bourses in negative territory.

LONDON — European stocks closed lower on Monday as investors prepare for more key inflation data out of the U.S. this week.

The pan-European Stoxx 600 index provisionally ended 0.5% lower, with most sectors and major bourses in negative territory. Autos stocks led the losses, down 2.7%, while utilities bucked the trend to close over 1.2% higher.

German energy company Uniper fell toward the bottom of the Stoxx 600. Shares of the firm fell 15% after a dispute flared up between Germany and Finland over the cost of rescuing the gas importer. The company asked for a German government bailout last week but its Finnish main shareholder Fortum rejected calls for more help for the ailing firm.

Swiss travel retailer Dufry was among the top performers. Shares of the company rose more than 4% after it said it had agreed to buy Italian airport and motorway caterer Autogrill.

Europe's markets closed higher last Friday as investors digested a stronger-than-expected jobs report out of the U.S., which showed that the economic downturn worrying investors has not yet arrived.

The jobs report, while good for the economy, could embolden the Federal Reserve to continue its aggressive rate hikes in the coming months to fight persistently high inflation. It will be tested with a slew of U.S. earnings from major banks and the latest consumer inflation reading coming up this week.

The June consumer price index on Wednesday is expected to show headline inflation, including food and energy, rising above May's 8.6% level.

Elsewhere, investors in the U.K. will be watching developments surrounding the political uncertainty in the country after Prime Minister Boris Johnson announced he would be resigning as Conservative Party leader.

Johnson said he would stay on in the post while a successor was found. Eleven Conservatives lawmakers have announced their leadership bids over the weekend.

Stateside, U.S. stocks fell on Monday as Wall Street braced for company earnings reports scheduled for later in the week. The forthcoming quarterly figures could signal how soaring inflation is impacting businesses.

In Asia-Pacific markets, Hong Kong's Hang Seng index fell more than 2% after news that China has imposed fines on heavyweights Tencent and Alibaba.

China imposed fines on several companies, including tech giants Alibaba and Tencent, for not complying with anti-monopoly rules on disclosure of transactions, according to Reuters.

There are no major earnings or data releases on Monday.

— CNBC's Patti Domm and Abigail Ng contributed to this market report.

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