European Shares Rise on Tech and Resource Sector Boost; Eyes on U.S. Inflation Data - By Pranav Kashyap
European shares opened higher on Wednesday, with the tech and basic resources sectors leading the gains. Investors are eagerly awaiting a key U.S. inflation reading to gauge the Federal Reserve's interest rate decision next week.
The pan-European index climbed 0.2%, with all regional indexes trading in positive territory. ASML Holding's 3.8% jump boosted the technology sector by 1.4%, while basic resources gained 1.2% on higher prices due to a weaker U.S. dollar.
In the UK, the benchmark index rose 0.4% as GDP data showed no change in economic output in July. With limited economic data from Europe, all eyes are on the U.S. consumer price figures set to be released later in the day.
Traders are anticipating a potential interest rate cut by the Fed next week, with a 33% chance of a 50-basis-point cut. Global investors are also cautious following the U.S. presidential debate, which saw betting markets favoring Kamala Harris.
Investors are navigating through uncertainty ahead of the November election, with markets closely watching comments from ECB officials and the central bank's meeting tomorrow. Commerzbank surged 16% after UniCredit bought a stake, while Rentokil slumped 18.5% due to a revenue slowdown.
Inditex lifted the retail sector with a 4.2% gain after reporting strong sales. The European Central Bank is expected to cut interest rates by 25 basis points at its upcoming meeting.
Overall, market volatility is expected to increase as uncertainty looms over the U.S. election and central bank decisions. Investors should stay cautious and closely monitor economic data and policy updates to navigate through these turbulent times.