Spain's main stock index Ibex-35 extended losses on Tuesday in its third consecutive negative session, after China cut interest rates for the second time in three months following a series of weak economic data.

The People's Bank of China unexpectedly lowered official interest rates in a fresh sign that authorities are stepping up monetary easing efforts to boost a faltering economic recovery.

The move came after data on China's industrial production and retail sales on Tuesday showed the economy slowed further last month, which has intensified pressure on already faltering growth in the country.

"Investors remain doubtful about the strength of the Chinese economy," Renta 4 analysts said in a note to clients.

On a day that coincides with a public holiday in several European countries, investors will turn their attention in the session to the release of Germany's ZEW survey of August expectations (0900 GMT), as well as U.S. retail sales data and New York's manufacturing survey (both at 1230 GMT).

At 07:15 GMT on Tuesday, Spain's selective stock market index Ibex-35 was down 2.80 points, or 0.03%, to 9,426.80 points, while the FTSE Eurofirst 300 index of large European stocks was down 0.04%.

In the banking sector, Santander lost 0.06%, BBVA fell 0.31%, Caixabank advanced 0.10%, Sabadell fell 0.54%, Bankinter dropped 0.36%, and Unicaja Banco lost 0.19%.

Among the large non-financial stocks, Telefónica gained 0.27%, Inditex advanced 0.33%, Iberdrola dropped 0.46%, Cellnex fell 0.20%, and the oil company Repsol rose 0.54%.

(Report by Benjamín Mejías Valencia; edited by Flora Gómez)