The FTSE MIB index fell 0.6% to close at 39,561, in line with broader Eurozone markets, as investors digested central bank signals and trade talks.
Fresh data showed that inflation in the Eurozone rose to 2% in June, prompting ECB President Christine Lagarde to note that the inflation target had been achieved and limit bets of additional cuts this year.
Fed Chair Jerome Powell stressed a cautious stance amid tariff uncertainty, saying the US would “wait and see” how inflation evolves.
Meanwhile, the EU seeks immediate relief from key US tariffs in any deal ahead of the July 9 deadline, though asymmetry is expected.
On the corporate front, Leonardo dropped 5% while Mediobanca, BPER Banca, and Banca Popolare di Sondrio dropped over 3% each to set the pace for lenders.
On the other hand, promising economic data from China lifted luxury and spirits firms, with Brunello Cucinelli, Moncler, and Camapri adding between 3.5% and 2%.