STOXX 600 gains 0.4% after U.S. inflation data sparks rate hike fears, lifting bond yields and keeping oil prices elevated.
European stocks recovered early Wednesday, with the STOXX 600 rising 0.4% and London’s FTSE 100 up 0.3%, following a rebound from Tuesday’s losses. The gains came despite heightened concerns over inflation after U.S. consumer prices rose at their fastest pace in three years, driven by energy costs tied to Middle East tensions.
The 10-year U.S. Treasury yield climbed to 4.4629%, its highest since late March, while Japan’s 5- and 20-year government bond yields hit record highs. Oil prices remained elevated, with Brent crude at $107.3 and West Texas Intermediate at $101.45, despite slight daily declines.
Markets are in a cautious stance as traders assess the likelihood of earlier-than-expected central bank rate hikes amid persistent inflation pressures and geopolitical risks.