European shares decline as cautious Fed commentary weighs
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German wholesale prices fall 1.8% in April
STOXX 600 down 0.6%
Updated at 1600 GMT
By Shashwat Chauhan and Khushi Singh
May 28 (Reuters) -European shares fell in broad-based declines on Tuesday in the lead-up to crucial inflation prints around the world this week, while cautious commentary from Federal Reserve officials further dented sentiment.
The pan-European STOXX 600 index .STOXX closed 0.6% lower, its biggest single-day day drop in a month. Most local equity indexes also ended the day lower, with French stocks .FCHI the worst hit, down 0.9%.
Minneapolis Fed President Neel Kashkari said in an interview with CNBC that the U.S. central bank should wait for significant progress on inflation before cutting interest rates.
Travel and leisure .SXTP led losses across the major STOXX 600 indexes, falling 2.8% as London-listed shares of Flutter Entertainment FLTRF.L shed 7.4%.
Heavyweight health care stocks .SXDP dipped 1%, while real estate .SX86P bucked the trend to rise 0.7%.
"Markets were relatively quiet because not much was going on from an economic point of view," said Axel Rudolph, senior market analyst at IG Group.
"And with this long weekend, a lot of traders didn't reposition their portfolios in any meaningful way."
The spotlight would be on May consumer prices data for the euro zone due on Friday, while individual inflation readings from Germany, Spain and France will also be released throughout the week.
The European Central Bank (ECB) looks set to start easing interest rates in its upcoming meeting next week, with bets showing an over 91% probability of a rate cut, according to LSEG data.
On the other hand, traders see a 50% chance the first rate cut from the Fed could happen in September, according to the CME FedWatch Tool.
Also on the radar would be the U.S. personal consumption expenditures price index, the Fed's preferred measure of inflation, on Friday for clues on whether it will be able to cut interest rates this year.
Meanwhile, a freshEuropean Central Bank survey showed euro zone consumers lowered their inflation expectations last month, with expectations for inflation in the next 12 months easing to 2.9% from 3.0% a month earlier, hitting their lowest level since September 2021.
German wholesale prices fell 1.8% in April compared with the same month last year.
Among individual stocks,German flavour and fragrance maker Symrise SY1G.DE added 1%after Deutsche Bank raised its ratingon the stock to buy from hold.
Reporting by Khushi Singh and Shashwat Chauhan in Bangalore; Editing by Sherry Jacob-Phillips, Janane Venkatraman and Nick Macfie
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