The Spanish stock index IBEX 35 opened Tuesday lower and lost the 11,000-point level once again, in the run-up to Federal Reserve Chairman Jerome Powell's statements before the US Congress.

Powell will appear before the Senate on Tuesday and the House of Representatives on Wednesday and investors will closely follow his comments for clues as to the timetable for rate cuts.

Several recent US labor market indicators point to a cooling of activity and could therefore pave the way for an easing of borrowing costs.

In particular, investors believe there is a nearly 80% chance of a cut in September, according to CME's FedWatch tool.

Overall, markets are discounting two rate cuts for the remainder of 2024, for a total of 50 basis points of easing.

Following Powell's comments, investors will be looking ahead to other economic data due out this week, including June CPI in the U.S. (Thursday), France and Spain (Friday).

"They should show a continuation of the trend towards moderation, favoring a scenario of lower rates that should be favorable for the stock markets," explained Renta 4.

Throughout the day, Meliá could also be replaced in the IBEX 35 in favor of the beauty group Puig, which went public at the beginning of May.

Thus, at 07:12 GMT on Tuesday, the selective Spanish stock market index IBEX 35 fell 57.90 points, or 0.53%, to 10,964.20 points, while the FTSE Eurofirst 300 index of large European stocks fell 0.39%.

If it closes lower, this would be the third day in negative territory for the IBEX, which had regained the 11,000-point level on July 3.

In the banking sector, Santander lost 0.63%, BBVA fell 1.00%, Caixabank dropped 0.63%, Sabadell fell 0.88%, Bankinter lost 0.87% and Unicaja Banco lost 0.78%.

Among the large non-financial stocks, Telefónica fell 0.15%, Inditex dropped 0.96%, Iberdrola dropped 0.25%, Cellnex fell 0.48%, and the oil company Repsol lost 0.96%.

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