European markets head for negative open, shrugging off China-U.S. trade talks progress

Zara owner Inditex on Wednesday posted weaker-than-expected quarterly sales while flagging a slower start to the summer season than last year amid broader economic uncertainty.

The Spanish retailer reported revenues of 8.27 billion euros ($9.44 billion) in the fiscal first quarter covering Feb. 1 to April 30, slightly shy of the 8.39 billion euros forecast by LSEG analysts.

Net income came in at 1.3 billion euros for the quarter, compared to the 1.32 billion euros analysts estimated.

— Karen Gilchrist

The U.S. and China have reached an agreement on trade, representatives from both sides said after a second day of high-level talks in London, with the deal now awaiting a nod from the leaders of the two countries.

"We have reached a framework to implement the Geneva consensus and the call between the two presidents," U.S. Commerce Secretary Howard Lutnick told reporters.

Chinese restrictions on rare-earth exports to the U.S. are a "fundamental part" of the latest agreement and the U.S. expects the issue "will be resolved in this framework implementation," Lutnick said.

He indicated U.S. restrictions on sales of advanced tech to China in recent weeks would be rolled back as Beijing approves rare-earth exports.

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— Evelyn Cheng

Good morning from London, welcome to CNBC's live blog covering European financial market action as well as the latest regional and global business news, data and earnings.

Futures data from IG suggests London's FTSE will open 14 points lower at 8,852, Germany's DAX down 105 points at 23,925, France's CAC 40 down 9 points at 7,788 and Italy's FTSE MIB 95 points lower at 40,082.

Global markets are having a mixed reaction to news that U.S. and Chinese officials reached a tentative consensus on trade after a second day of talks in London. The negotiators will now seek approval on the framework from the U.S. and Chinese presidents.

Asia-Pacific markets climbed overnight on the apparent breakthrough, but U.S. stock futures inched lower, with investors also looking ahead to May inflation data.

— Holly Ellyatt

Global markets will be keeping a close eye on the latest U.S. inflation report for May.

Economists polled by Dow Jones expect a 0.2% month-over-month increase, while the headline consumer price index is anticipated to have grown 2.4% on an annual basis. Hotter-than-expected data could spook investors who are already on edge over inflationary pressures and the trajectory of Federal Reserve rate cuts.

Traders will be keeping an eye on the Nvidia keynote address at the VivaTech conference in Paris on Wednesday, as well as Goldman Sachs' annual European Financials Conference.

Meanwhile, U.K. investors will be looking out for the government's "Spending Review," in which it sets out day-to-day spending and investment plans for all government departments. 

Earnings are set to come from retail giant Inditex.

— Holly Ellyatt