European shares steady ahead of key regional inflation data
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STOXX 600 up 0.1%
Covestro jumps on $16.4 billion buyout deal
Eurozone flash inflation data due 0900 GMT
Updated at 0815 GMT
By Pranav Kashyap
Oct 1 (Reuters) -European shares were largely steadyon Tuesday ahead ofkey inflation data forthe region later in the day.
The pan-European STOXX 600 .STOXX was up 0.1%at 523.42 after it logged its worst day in over aweek on Monday.
Techstocks .SX8P rose 1%, but were offset by losses of nearly 1% in luxury firms .STXLUXP.
European luxury firmsrallied last week, propelling the STOXX 600 to new highs on the back of Chinesestimulus measures.
"It'sstandard to see a pausing in a bullish run, given the strength of the gains that we saw last week," said Fiona Cincotta, senior market analyst at City Index.
Energy stocks .SXEP lost 0.9%, dragged down bya 5.8% decline in biofuels makerNeste Oyj NESTE.HE.
Investors are now looking ahead to the Eurozone's flash inflation figures for September, due at 0900 GMT, which could decide whether the European Central Bank (ECB) lowers interest rates at its next meeting in two weeks.
ECB President Christine Lagarde saidon Monday that the central bank is increasingly confident that inflation will drop to its 2% target.
Additionally, markets will be monitoring speeches from ECB Vice President Luis de Guindos, policymaker Olli Rehn, and board member Isabel Schnabel, who are set to speak at various events throughout the day, for further clues onrate cuts.
Meanwhile, manufacturing activity across the euro zone declined at its fastest pace this year in September, while theGerman manufacturing sector also contracted at its fastest rate in a year, PMI data showed.
France's manufacturing sector continued to contract in September, while Italy's manufacturing activity contracted for a sixth straight month in September.
Among individual stocks, Covestro 1COV.DE jumped 3.8% after Abu Dhabi National Oil Company (ADNOC) said it has agreed to buy theGerman chemicals producer for 14.7 billion euros ($16.4 billion).
Anheuser-Busch InBev ABI.BR gained 2.3%after Citigroup upgraded the Budweiser brewer's stock to "buy" from "neutral".
Across the pond, Federal Reserve Chair Powell indicated overnight that the central bankwould likely stick to 25 basis-point (bp) cuts henceforth after new data boosted confidence in economic growth and consumer spending.
"Markets building hopes of another 50 bp rate cut was overdone and we've seeing that optimism dialled back," City Index's Cincotta said.
Reporting by Pranav Kashyap in Bengaluru; Editing by Janane Venkatraman and Sonia Cheema
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