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European stocks rise on global optimism; inflation, PMI data in focus

Published 01/03/2024, 09:08
© Reuters.

Investing.com - European stock markets rose Friday, continuing the buoyant global mood ahead of the release of widely-awaited regional inflation and economic activity data.

At 03:05 ET (08:05 GMT), the DAX index in Germany traded 0.7% higher, the CAC 40 in France traded up 0.5% and the FTSE 100 in the U.K. climbed 0.7%.

Confidence on the rise ahead of key data

Global equities have received a boost from U.S. inflation data keeping alive expectations for rate cuts by the Federal Reserve in the early summer.

Japan's Nikkei Average recorded a fresh high overnight, on the heels of the S&P 500 and Nasdaq Composite closing at record highs on Thursday. 

Germany’s DAX also hit a fresh all-time high in the previous session, and further gains are likely ahead of the release of both eurozone flash February PMI numbers and consumer prices.

The eurozone CPI number is expected to fall to 2.5% on an annual basis, from 2.8% the prior month, heading back towards the European Central Bank’s 2% medium-term target.

A downside surprise also became a possibility after data this week showed inflation dipped to 2.7% from 3.1% in Germany, to 3.1% from 3.4% in France, and to 2.9% from 3.5% from Spain.

The European Central Bank meets next week, and while no policy change is expected, the bank could hint at rate cuts later in the year.

Earnings continue to emerge

In the corporate sector, the earnings season is gradually winding down but there are still a number of companies reporting their quarterly results.

These include Daimler (OTC:MBGAF) Trucks, U.K. education company Pearson (LON:PSON), Dutch insurer Aegon (NYSE:AEG), U.K. online property company Rightmove (OTC:RTMVY) and French manufacturing firm Vallourec (EPA:VLLP).

Crude rises on Fed cutting hopes 

Oil prices edged higher Friday, on course to post modest weekly gains after easing U.S. inflation played into expectations that the Federal Reserve could start cutting interest rates as early as June, potentially boosting economic activity in the world’s largest economy.

By 03:05 ET, the U.S. crude futures traded 0.3% higher at $78.47 a barrel, on track for at least a 2.5% increase this week, while the Brent contract climbed 0.3% to $82.19 a barrel, up just under 1% this week. 

But prices remained largely range bound as signs of higher supplies, amid record-high U.S. production and higher output from the Organization of Petroleum Exporting Countries (OPEC), signaled that global oil markets may not be as tight as initially expected.

Additionally, gold futures rose 0.1% to $2,052.70/oz, while EUR/USD traded 0.1% higher at 1.0813.


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