European Shares Surge On Rate Cut Bets

(RTTNews) - European stocks rallied on Friday after a European Central Bank (ECB) poll of professional forecasters showed that inflation in the euro zone will fall to 2 percent in 2025 and stay there in the longer term, giving the clearest indication that the ECB could cut interest rates in June.

In-line regional inflation and GDP data also boosted investor sentiment.

German consumer price inflation slowed to 2.2 percent in March from 2.5 percent in February, final data from Destatis revealed. That was in line with the flash data published earlier.

The latest inflation was the weakest since May 2021, when prices had risen the same 2.2 percent.

France's consumer price inflation posted an annual increase of 2.3 percent in March, following February's 3.0 percent rise, according to the latest data from the statistical office INSEE. That was in line with the flash data published on March 29.

U.K. real GDP edged up 0.1 percent on a monthly basis in February, following a revised 0.3 percent expansion in January, the Office for National Statistics reported. The growth came in line with expectations.

The pan European STOXX 600 jumped 1.1 percent to 510.25 after declining 0.4 percent on Thursday.

The German DAX rose a little over 1 percent, France's CAC 40 added 1.1 percent and the U.K.'s FTSE 100 climbed 1.3 percent.

BP Plc jumped 3 percent and peer Shell added 2 percent in London as Brent crude futures climbed above $90 a barrel on speculation that Iran will respond to Israel's attack on its Syrian embassy.

Mining giant Anglo American soared 4 percent, Antofagasta rallied 3.5 percent and Glencore surged 3.4 percent as base metals extended a rally on increased supply risks and an improving outlook for demand.

Mercantile Investment Trust rose over 1 percent after it swung to an annual profit.

Housebuilders advanced following positive commentary from JPMorgan. Barratt Developments rose 2.3 percent, Persimmon added 2.9 percent and Taylor Wimpey climbed 3.6 percent.

French lender Societe Generale surged 4.7 percent, a day after announcing a deal to sell its professional equipment financing business to rival BPCE for €1.1bn.

Shares of ThyssenKrupp AG surged nearly 3 percent. The German industrial engineering and steel company late Thursday announced its loss-making Steel division's structural realignment, including a significant cut in Duisburg's production capacity, as well as jobs that are yet to be quantified.