The Spanish IBEX 35 stock index was unable to lift its head on Tuesday and pointed to a third consecutive negative session in the face of the geopolitical, economic and monetary uncertainties looming over the financial markets.

In any case, new positions are likely to be limited, pending the arrival of several important references in the field of central banks.

The highlight of the week will come on Wednesday, with the release of the US consumer price index (CPI) for March, which could provide clues as to the timing of the Fed's interest rate cuts.

In recent days, markets have sharply reduced bets on rate cuts this year amid signs of economic and price strength, so a higher-than-expected CPI could exacerbate the correction in equity markets.

In this regard, Sergio Avila, an analyst at IG, highlights recent statements by Minneapolis Fed President Neel Kashkari, who "(emphasized) the need for an uninterrupted stance in the fight against rising prices, especially in a context where the labor market is showing signs of tension without becoming overheated".

This scenario has reduced the odds of a June rate cut to 50.3%, down from levels above 60% last week, according to interest rate futures on LSEG's IRPR tool. Now investors are not even sure whether there will be two 25 basis point cuts this year or three, after six cuts were forecast in January.

Elsewhere, investors will be looking ahead to Wednesday's release of the minutes of the Fed's latest meeting and the European Central Bank's meeting on Thursday, which is expected to hint at a cut in June, although there are fears of hawkish comments.

On the international political front, the focus was on the Middle East, where hopes of a near truce between Israel and Hamas seemed to be receding.

At 07:15 GMT on Tuesday, Spain's IBEX 35 was down 43.70 points, or 0.40%, to 10,868.10 points, while the FTSE Eurofirst 300 index of large European stocks was down 0.25%.

In the banking sector, Santander lost 0.43%, BBVA gained 0.05%, Caixabank advanced 0.48%, Sabadell gained 0.26%, Bankinter gained 0.03%, and Unicaja Banco rose 0.51%.

Among the large non-financial stocks, Telefónica gained 0.10%, Inditex fell 0.82%, Iberdrola dropped 0.89%, Cellnex fell 0.17%, and the oil company Repsol rose 0.09%.

(Information by Tomás Cobos)