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European shares rose in early trade on Wednesday ahead of a public meeting of central bankers as investors buoyed by an overnight tech-led rally on Wall Street.
The pan-European Stoxx 600 rose 0.5 percent, extending gains over the previous day, while France’s CAC 40 added 0.6 percent in the first hour of trading. Germany’s Dax rose 0.6 percent.
The move came a day after the benchmark S&P 500 closed higher and the tech-focused Nasdaq Composite posted its biggest daily gain in a month. Indices were boosted by fresh manufacturing and consumer confidence data, which pointed to continued economic growth in the US economy after a year of rising interest rates. The Stoxx Europe 600 technology index rose 0.9 percent.
Still, investors remained cautious about the prospect of further policy tightening by the US Federal Reserve, with the central bank’s latest guidance suggesting the benchmark federal funds rate will rise twice more before the end of the year.
Traders prepare for Fed Chairman Jay Powell to participate in a policy panel with central bankers from Europe and the UK at the European Central Bank Forum in Portugal on Wednesday.
A day earlier, ECB President Christine Lagarde also indicated that policymakers are prepared to continue raising eurozone interest rates this year to combat inflation, raising concerns that higher borrowing costs may soon hit the economy. It will take
Germany’s consumer confidence index forecast for July fell to minus 25.4 from minus 24.4 in the previous month, falling short of analysts’ expectations, according to a report from research group GfK on Wednesday.
Meanwhile, US futures slipped, with contracts tracking Wall Street’s benchmark S&P 500 shedding 0.2 per cent, while those tracking the Nasdaq 100 shed 0.4 per cent ahead of the New York open.
Australia’s S&P/ASX 200 index rose 1.1 percent after official data showed inflation eased more sharply than expected in May, raising the prospect of the Reserve Bank of Australia holding off on raising interest rates.
Trading elsewhere in Asia was mixed, with China’s CSI 300 falling 0.1 per cent while Hong Kong’s Hang Seng rose 0.2 per cent. Strong gains in the technology sector led to a 2 percent gain in topics from Japan.
