The IBEX 35 trimmed positions on Monday as some investors took profits after four consecutive gains that have taken the Spanish stock index to its highest levels in almost seven years.

The scenario, however, was still dominated by a greater appetite for risk in view of last week's signals about interest rate cuts by the major central banks in the coming months.

Market bets on monetary easing will be put to the acid test with the release of several inflation figures this week.

The main benchmark will be the US core private consumption deflator, known as the PCE index, to be released on Friday, and inflation figures will also come in from several eurozone countries.

In the current context, analysts at Renta 4 believe that "the risk-return trade-off continues to be attractive in an environment of an improving economic cycle and where rates should have peaked".

"We believe that there are several risk factors that could determine better entry points in the stock markets, such as: 1) Further adjustment of expectations of rate cuts by the market, based on inflation data that slows its downward trend; 2) Geopolitical risks with upward implications for inflation (situation in the Middle East, Red Sea); 3) CRE (commercial real estate) in the US," they added.

At 08:12 GMT on Monday, the selective Spanish stock market IBEX 35 fell 2.00 points, or 0.02%, to 10,941.20 points, while the FTSE Eurofirst 300 index of large European stocks advanced 0.07%.

In the banking sector, Santander rose 0.31%, BBVA gained 0.37%, Caixabank advanced 0.42%, Sabadell fell 0.83%, Bankinter dropped 0.03%, and Unicaja Banco rose 0.18%.

Among the large non-financial stocks, Telefónica gained 0.10%, Inditex gave up 0.71%, Iberdrola gained 0.04%, Cellnex gained 0.18%, and the oil company Repsol rose 0.13%.

(Information by Tomás Cobos; edited by Mireia Merino)