Morning Bid: Nestle in sticky situation, much like euro zone inflation

A look at the day ahead in European and global markets from Ankur Banerjee

A sleepy start to a data-heavy week will get its first test when an inflation report for the euro zone comes out during European hours, while investor focus will also be on Nestle after the Kitkat maker abruptly dismissed its CEO.

Euro zone inflation is likely to have remained stable at 2.0% in August, showed economist estimates compiled by Reuters. Data from Germany, France, Italy and Spain last week indicated inflation stayed close to the European Central Bank's target.

The ECB left its key interest rate at 2% at its July policy meeting and market watchers expect it to do so again this month before discussion about further cuts resume in the autumn.

NESTLE UPHEAVAL

Nestle dismissed Laurent Freixe exactly a year after becoming CEO for not disclosing a romantic relationship with a subordinate.

The dismissal also came a year after predecessor Mark Schneider's sudden departure, and two and a half months after longstanding chair Paul Bulcke announced he would step down in 2026, amounting to one of the most turbulent periods in the food giant's history.

Nestle's stock price has fallen more than 17% over the past 12 months, versus a 5% gain in the pan-European STOXX 600. Watch out for fireworks at the open.

RATE-CUT WAGERS

Meanwhile, the broader market struggled for direction as investors geared up for a U.S. jobs report on Friday that will influence the Federal Reserve's near-term policy path. Investors broadly expect a 25 basis-point cut at its September meeting.

Relentless attacks on the Fed from President Donald Trump have also kept investors wary, with Trump's efforts to fire Governor Lisa Cook raising the prospect of him making more dovish appointments at the central bank.

Comments from Treasury Secretary Scott Bessent stoked further concern about the Fed's independence and credibility.

"The Fed should be independent. The Fed is independent, but I, I also think that they've made a lot of mistakes," Bessent said in an interview.

The dollar has remained under pressure on rate-cut wagers, propelling gold to break above $3,500 an ounce to a record high. The metal is up 33% this year after gaining 27% last year.

Key developments that could influence markets on Tuesday:

* Economic data: Euro zone inflation data for August

(By Ankur Banerjee; Editing by Christopher Cushing)