European Stocks Close On Bright Note On Tamer-than-expected U.S. Inflation Data

(RTTNews) - European stocks closed on a strong note on Tuesday as tamer-than-expected U.S. inflation data helped ease concerns about the outlook for interest rates and lifted investor sentiment.

Investors also digested a slew of European economic data.

The Federal Reserve, the Bank of England, the European Central Bank and the Swiss National Bank are set to announce their monetary policies this week.

The Labor Department's report said the consumer price index crept up by 0.1% in November after climbing by 0.4% in October. Economists had expected consumer prices to rise by 0.3%.

The report also showed the annual rate of growth by consumer prices slowed to 7.1% in November from 7.7% in October.

The Federal Reserve, which is scheduled to announce its monetary policy on Wednesday, is still likely to raise interest rate by another 50 basis points, but the slower price growth may offset recent worries about future rate hikes.

The pan European Stoxx 600 climbed 1.29%. The U.K.'s FTSE 100 gained 0.76%, Germany's DAX surged 1.34% and France's CAC 40 firmed 1.42%, while Switzerland's SMI ended 0.93% up.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Finland, Greece, Ireland, Netherlands, Norway, Poland, Spain, Sweden and Turkiye ended with sharp to moderate gains.

Portugal closed modestly higher, while Iceland and Russia edged up marginally.

In the UK market, ICP surged 5.65%, Ocado Group climbed 4.57% and Antofagasta gained about 4.1%.

Ashtead Group, Prudential, Scottish Mortgage, Hargreaves Lansdown, Smurfit Kappa Group, Convatec, Segro and Schrodders ended stronger by 3 to 4%.

Rolls-Royce Holdings drifted down 2.4%, while Imperial Brands, Centrica, British American Tobacco, Pearson, BAE Systems and Informa lost 1 to 2%.

In Paris, Unibail Rodamco, Dassault Systemes, STMicroElectronics, Societe Generale, ArcelorMittal, Schneider Electric, TotalEnergies, Legrand, Saint Gobain, Pernod Ricard and Michelin gained 2 to 4%.

Thales ended lower by about 2.7%, and Renault drifted down 1.5%.

In the German market, Zalando rallied more than 5%. Adidas, Vonovia, Puma, Infineon Technologies, HelloFresh, Deutsche Wohnen, Merck, Deutsche Post, Covestro, Fresenius Medical Care, Sartorius, Deutsche Bank, Continental and Fresenius gained 2 to 4.7%.

In economic releases, Germany's consumer price growth slowed in November amid a modest easing in energy prices, but the inflation rate remained high denying any respite to the European Central Bank policymakers who are set to deliver yet another interest rate hike later this week.

Consumer price inflation in the biggest euro area economy eased to 10% from 10.4% in October, latest figures from Destatis showed.

The consumer price index dropped 0.5% from October, when it rose 0.9%. The harmonized index of consumer prices, which is meant for comparison of inflation rates among EU members, rose 11.3% year-on-year following an 11.6% increase in October.

German economic confidence strengthened to a 10-month high at the end of 2022, a monthly survey conducted by the Mannheim-based research institute ZEW revealed. The ZEW Indicator of Economic Sentiment rose sharply to -23.3 in December from -36.7 in November.

France's payroll employment increased slightly more than initially estimated in the third quarter, latest data from the statistical office INSEE showed. Payroll employment, which includes the private and public sectors, fell 0.4% or 103,200 from the previous quarter.

Elsewhere, the U.K. jobless rate edged up in the three months ended October as firms held back recruitment amid recession fears, official data showed earlier today.

The ILO jobless rate edged up to 3.7% in three months to October in line with expectations and up from 3.6% in three months to September. The employment rate increased 0.2 percentage points on the quarter to 75.6%.

The Swiss economy will experience sluggish growth but it will not enter a severe recession next year, and is set to fare better in 2024 on the back of a global recovery, the State Secretariat for Economic Affairs, or SECO forecast Tuesday. The economy will grow only 1% next year, instead of 1.1% estimated in September. The outlook for 2022 was retained at 2%.