European Shares Edge Higher On Rate Cut Hopes

(RTTNews) - European stocks advanced on Thursday, with underlying sentiment supported by encouraging economic data from Germany and U.K. as well as expectations of a Federal Reserve rate cut in September.

Federal Reserve Chair Jerome Powell reiterated on Wednesday that the U.S. job market is cooling and that the central bank will act 'when and as' needed regardless of political factors.

There are expectations that a U.S. government report due later in the day will show consumer price inflation continued to moderate in June.

Closer home, soft inflation data from Germany left the door open for another European Central Bank rate cut in September.

The consumer price index rose 2.2 percent in June, following May's 3-month high of 2.4 percent. That was in line with the flash data published earlier.

EU-harmonized inflation also softened to 2.5 percent from 2.48 percent, as estimated.

Elsewhere, data showed the U.K. economy rebounded at a faster-than-expected pace in May, adding to doubts about the possibility of an August rate cut by the Bank of England.

Real GDP grew 0.4 percent in May after showing no growth in April, the Office for National Statistics reported. The actual growth was double the expected 0.2 percent expansion.

The pan European STOXX 600 was up 0.4 percent at 518.69 after rising 0.9 percent on Wednesday.

The German DAX edged up 0.2 percent, France's CAC 40 added half a percent and the U.K.'s FTSE 100 was up 0.3 percent.

In corporate news, Hugo Boss rose about 2 percent after Frasers Group increased its stake in the German fashion brand.

Fielmann surged 3.5 percent. The eyewear company forecast improved EBT margin for 2024 and 2025 after posting encouraging results for the first half.

Suedzucker slumped 4.3 percent after the sugar producer posted a 45 percent fall in first-quarter earnings.

French media group Vivendi rallied 2.2 percent after JP Morgan placed the stock on its "positive catalyst watch.

British water company Pennon soared 7.5 percent after naming an insider as its new CFO.

Peer Severn Trent rallied 3 percent after reporting a strong start to the year.

Oil services firm John Wood declined 1.2 percent after revenues fell 6 percent in the six months to 30 June.

Hays climbed 1.1 percent. The recruiter said it expects full-year profit to be around the bottom end of the market consensus range.