Spain's IBEX 35 stock index posted a slight decline at Friday's open and was heading for its biggest weekly retreat since July 2023, as investors scrutinize apparent contradictions between the latest macroeconomic data and Fed comments.

Federal Reserve (Fed) policymakers discouraged equity markets on Wednesday by pushing back the horizon of monetary easing.

However, investors seem convinced that the US central bank will cut interest rates sooner than expected, missing its own outlook, in light of macroeconomic data released this week showing moderating inflation.

"Positive data set for both stocks and bonds. The downward surprise in Industrial Prices reinforces the positive impact of a better-than-expected U.S. CPI released on Wednesday. In addition, Weekly Jobless Claims came in at the highest level in 10 months, showing some cooling in employment," Bankinter analysts said in a daily report.

The outlook for rate cuts weighed on the banking sector this week, which in Spain has a weight of around a third of the IBEX 35.

So far this week, Santander has fallen by 7%, BBVA by 8.7%, Caixabank by 6.2%, Sabadell by 9% and Bankinter by 4%.

On Friday, Santander lost 0.36%, BBVA fell 0.88%, Caixabank dropped 0.96%, Sabadell fell 1.40% and Bankinter lost 0.31%.

For its part, the selective Spanish stock market IBEX 35 fell 39.80 points, or 0.36%, to 11,026.30 points, at 07:15 GMT on Friday, while the FTSE Eurofirst 300 index of large European stocks fell 0.08%.

For the week as a whole, the IBEX 35 shows a decline of 3.33%, slightly higher than the 3.28% decline recorded in the week ending August 4, 2023.

Among the large non-financial stocks, Telefónica fell by 0.85%, Inditex advanced by 0.15%, Iberdrola dropped by 0.25%, Cellnex fell by 0.82%, and the oil company Repsol lost 0.53%.

On Friday, the only important reference will be the University of Michigan's consumer confidence survey, so part of the market is already focused on next week's news, when, according to Bankinter, the governing councils of several central banks will meet: the United Kingdom, Switzerland, Brazil, Norway and Australia.

(Information by Tomás Cobos; edited by Javi West Larrañaga)