The S&P 500 and Nasdaq 100 faced challenges in building on small advances, raising concerns about the world’s largest economy potentially entering a recession.

Treasury rates and a dollar index fell for a third day, while European and US central bankers signaled they have reached a turning point in the fight against inflation.

Stock bulls have had a poor second half, and they will consider second-quarter earnings.

HSBC Asset Management’s APAC chief investment officer Cecilia Chan warned that US equity markets have priced in a soft landing or a more friendly recession, but the risk is for the recession to come in harder than expected.

The Stoxx Europe 600 index was on course for a third day of gains after Francois Villeroy de Galhau claimed the European Central Bank is virtually done raising.

The UK benchmark plummeted as salary statistics pressured the Bank of England to raise rates.

European luxury-goods, mining, and construction industries rose, with L’Oreal SA, Richemont, and LVMH increasing over 1%.

A stock repurchase boosted Daimler Truck Holding AG by 3.1%, and Kingspan Group Plc rose 14% after a positive trading statement.

Hong Kong, South Korea, and Taiwan led Asian equity advances, with semiconductor markets jumping.

US consumer-price statistics on Wednesday will reveal pricing and interest rate trends.

The pound reached its highest against the dollar since April 2022.

The latest Markets Live Pulse survey suggests that profit warnings and rising interest rates may hurt the S&P 500.