After three sessions of back and forth, the Spanish stock index IBEX 35 faced Thursday's session with a slight downward trend, as investors await multiple crucial references on the political and macroeconomic fronts.

The downward trend, partly motivated by the collection of the profits obtained in Wednesday's rally, was contained by the weakness observed in the latest data on the US economy, as the economic deterioration reduces the fear of inflation and thus paves the way for the Federal Reserve's (Fed) interest rate cuts.

Also, the weaker-than-expected services report and ADP private employment indicator were in line with the view of the Fed's June meeting minutes, in which its members acknowledged that the U.S. economy appeared to be slowing and that "price pressures were easing".

In any case, this monetary optimism will meet with a litmus test on Friday, when the full U.S. jobs report for June will be released, which is of particular relevance for the Fed in deciding its monetary policy.

Wednesday's weaker-than-expected U.S. economic data, such as the services report and the ADP employment report, showed a slowing economy, following last week's increase in initial jobless claims.

"Slowly, but surely what we're starting to see is a little bit of a turnaround in the U.S. economic data flow," said Rodrigo Catril, currency strategist at National Australia Bank (NAB).

The minutes of the Fed's June meeting acknowledged that the U.S. economy appeared to be slowing and that "price pressures were easing."

According to interest rate futures on LSEG's IRPR tool, markets have currently raised the odds of a September rate cut to plus 72%, up from below 60% a week ago.

Meanwhile, investors will be watching the outcome of Thursday's UK general election, with an expected victory for Keir Starmer's Labour that would end 14 years of Conservative rule.

"The Labour victory could benefit the pound and the British stock market, in the face of a more constructive stance towards the EU to which will be added the upcoming start of rate cuts by the Bank of England (the market places the first cut on 1-August with a 63% probability for -25 bp)," said the brokerage house Renta 4 in its daily report.

All in all, markets are more interested in the second round of the French legislative elections to be held on Sunday, amid fears that the far-right could gain power and endanger the country's public finances with increased spending.

More in the medium term, Renta 4 analysts indicate that "pressure is mounting on (US President Joe) Biden to withdraw from the presidential race after the poor outcome of the debate a week ago".

Otherwise, Thursday's session will be marked by the absence of the Wall Street benchmark due to the Independence Day holiday in the United States.

At 0715 GMT on Thursday, Spain's selective IBEX 35 stock market index was down 24.10 points, or 0.22%, to 11,032.70 points, while the FTSE Eurofirst 300 index of large European stocks was up 0.28%.

In the banking sector, Santander rose 0.72%, BBVA gained 0.46%, Caixabank advanced 1.36%, Sabadell gained 0.64%, Bankinter gained 0.90%, and Unicaja Banco rose 0.86%.

Among the large non-financial stocks, Telefónica gained 0.15%, Inditex lost 0.13%, Iberdrola lost 2.89%, Cellnex fell 0.32%, and the oil company Repsol lost 2.92%, in a context of falling crude oil prices.

(Information by Tomás Cobos; additional information by Brigid Riley; edited by Benjamín Mejías Valencia).