A look at the day ahead in European and global markets from Rae

Wee

Beijing's latest stimulus pledges were met on Monday with a

mixed and volatile response in Chinese stocks, with investors

showing no consensus view on promises over the weekend that were

long on intent but short on details.

Hong Kong shares got off to a choppy start before turning

decisively lower, in contrast with their peers in mainland China

which mostly traded higher.

Some analysts attributed the divergent performance to the

lack of a dollar figure for the package, which may have mattered

more to foreign investors than to their Chinese counterparts.

The sweeping measures - from helping local governments

tackle their debt problems to supporting the property market and

replenishing state banks' capital - underscored policymakers'

commitment to supporting the ailing Chinese economy.

But the limited scope of efforts to boost domestic

consumption remains a huge concern for investors, particularly

after data on Sunday showed China's consumer inflation

unexpectedly eased in September while producer price deflation

deepened.

The mixed picture across Chinese markets on Monday has set a

negative tone for Europe, where EUROSTOXX 50 futures

and FTSE futures both fell around 0.1% each.

Shares of European luxury goods companies will be in focus

given the attention to China, with a gauge of 10 top European

luxury stocks already up nearly 9% since Sept. 24,

when Beijing unveiled its most aggressive stimulus since the

pandemic.

The week also brings a raft of data from China, including

the country's third-quarter growth figures on Friday, so there

will be lots for investors to chew on in the coming days.

China aside, a rate decision by the European Central Bank is

due on Thursday, where expectations are for policymakers to

deliver a 25-basis-point rate cut. UK inflation data is due on

Wednesday.

Remarks from the Federal Reserve's Neel Kashkari and

Christopher Waller are expected later on Monday, and there is

strong interest in what they might say about the central bank's

rate outlook.

An outsized 50-basis-point rate cut next month is now off

the table, given signs of a resilient U.S. economy, and that's

kept the dollar well-supported and hovering near a seven-week

high against a basket of major peers on Monday.

Key developments that could influence markets on Monday:

- Fed's Kashkari, Waller speak

- France reopening of 3-month, 6-month, 7-month and 1-year

government debt auctions

- Germany reopening of 1-year government debt auction