Oct 18 (Reuters) - European stocks inched lower on Wednesday as deepening fears over an escalation in the Middle East conflict and a drop in ASML shares after the chipmaker's lacklustre forecast overshadowed support from upbeat economic data from China.

The pan-European STOXX 600 index was down 0.2% by 0703 GMT.

A strike on a Gaza hospital that killed hundreds of Palestinians raised the stakes for U.S. President Joe Biden's visit to Israel on Wednesday.

ASML Holding dropped 3.7% as the semiconductor equipment maker warned of flat sales in 2024, after reporting third-quarter earnings in line with analysts' expectations.

Shares of China-exposed luxury firms such as LVMH, Hermes and Richemont rose between 0.2% and 0.8% on better-than-expected growth data from the world's second-largest economy.

Adidas jumped 4.7% after the sportswear firm lifted its revenue forecast and cut its expected loss for 2023.

Data showed British annual consumer price inflation was unchanged at 6.7% in September, bucking economists' expectations for a further decline.

(Reporting by Amruta Khandekar; Editing by Sherry Jacob-Phillips)