As the week begins, it is anticipated that European stock markets will trade in a mixed manner at the opening on Monday.

As the week begins and crucial inflation data, a policy-setting meeting of the Bank of Japan, and the return of the World Economic Forum to Davos are all on the agenda, it is anticipated that European stock markets will trade in a mixed manner at the opening on Monday.

Given that the American stock market will be closed for the Martin Luther King Jr. holiday, trading volumes in Europe are likely to be lower on Monday.

German wholesale prices decreased 1.6% on a month-over-month basis in December, according to economic statistics released earlier on Monday. However, this week's initial attention will probably be on Tuesday's publication of the results of the ZEW poll of German economic mood for January.

With both the DAX and the CAC 40 up over 8% so far this year, European equities have benefited from this improved sentiment. This is predicted to rise to -15.5 from -23.3 in December.

This is largely because central banks have been able to ease back from their aggressive monetary tightening as there are signs that inflation is declining.

Investors will be looking for confirmation that the worst of the global price squeeze is over in this week's final reading of inflation for the Eurozone and Britain. Data released late last week showed that U.S. consumer prices declined in December for the first time in more than two and a half years.

The Bank of Japan has been the main outlier, primarily keeping its extremely accommodating monetary stance despite its key peers significantly tightening interest rates.

However, when the BOJ surprised markets last month by enlarging the range around its target yield on 10-year bonds, a move that investors interpreted as a precursor to a future rate hike, this may be changing.

This puts the policy-setting meeting on Wednesday squarely in the spotlight amid expectations that it may make additional changes to its yield curve control strategy, the first phase of winding down its huge stimulus.

On the first day of a week that will feature a wealth of economic data as well as demand predictions from OPEC and the IEA, oil prices declined, giving back some of last week's significant gains.

The International Energy Agency follows the Organization of Petroleum Exporting Countries by releasing its most recent research on Wednesday. After the world's largest crude importer lifted COVID-19 limitations in late 2022 following years of rigorous lockdowns, traders will be watching to see what the agencies have to say about China's oil consumption.

(Investing.com, reuters.com)