European Stocks Erase Early Gains as Inflation Fears Resurface

European equity benchmarks surrendered early gains on May 27, 2026, as renewed inflation concerns sparked a late-session sell-off, ending a three-day winning streak. The pan-European Stoxx 600 index fell 0.3% after climbing as much as 0.5% in early trading. Germany’s DAX and France’s CAC 40 also reversed course, closing lower. The downturn followed a survey showing an unexpected uptick in medium-term inflation expectations, undermining investor hopes for imminent rate cuts from the European Central Bank. Traders now see a lower probability of policy easing in July, shifting focus to upcoming consumer price data.