European Stocks Close On Firm Note On Encouraging Economic Data

(RTTNews) - European stocks closed higher on Wednesday as investors reacted to some encouraging economic data, including consumer price inflation data from the U.K. and the U.S.

The less than expected increase in U.S. consumer price inflation has raised hopes of rates cuts by the Federal Reserve. Data from the Office for National Statistics showed UK consumer price inflation moderated unexpectedly in December.

Data from the Labor Department showed consumer prices in the U.S. rose by slightly more than expected in December, while the annual rate of core consumer price growth unexpectedly slowed.

The Labor Department said its consumer price index climbed by 0.4% in December after rising by 0.3% in November. Economists had expected consumer prices to rise by another 0.3%.

The report also said the annual rate of growth by consumer prices accelerated to 2.9% in December from 2.7% in November, in line with economist estimates.

The pan European Stoxx 600 climbed 1.33%. The U.K.'s FTSE 100 closed higher by 1.21%, Germany's DAX advanced 1.5% and France's CAC 40 closed 0.69% up, while Switzerland's SMI gained 0.68%.

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

The markets in Iceland and Russia ended weak.

In the UK market, Lloyds Banking Group and Barclays Group both ended higher by 6.5%. Natwest Group climbed 5% and Standard Chartered rallied 3.3%.

St. James's Place closed stronger by 6.21%. Howden Joinery, Diploma, Severn Trent, Taylor Wimpey, Land Securities, United Utilities, Whitbread, Barratt Redrow, Persimmon, Unite Group, Convatec Group and British Land gained 4 to 5.3%.

Shares of wind turbine manufacturer Nordex rallied sharply after the company announced that it has significantly increased its order intake last year to 8.34GW, up from 7.36GW in 2023.

Endeavour Mining lost 1.7%. Anglo American Plc, Reckitt Benckiser, Imperial Brands, Melrose Industries and Rolls-Royce Holdings closed down by 0.5 to 1%.

In the German market, Bayer climbed nearly 6%. Vonovia, Brenntag, Deutsche Post, BASF, Zalando, Continental, Siemens Energy and Deutsche Bank gained 3 to 5%.

SAP, Porsche, Infineon, HeidelbergCement, Fresenius Medical Care, Allianz, RWE, Munich RE, Adidas, BMW, Volkswagen, Mercedes-Benz, E.ON and Fresenius also ended notably higher.

In the French market, Sanofi, Michelin, Unibail Rodamco, Societe Generale, Edenred, ArcelorMittal, STMicroElectronics, Vivendi, Saint-Gobain, Bouygues, Renault, BNP Paribas and AXA gained 2 to 3.1%.

LVMH ended down 1.6%. Pernod Ricard, Airbus Group and Dassault Systemes ended moderately lower.

Data from the Office for National Statistics showed UK consumer price inflation moderated unexpectedly in December, registering an annual increase of 2.5% in the month, weaker than the 2.6% rise in November. The rate was seen unchanged at 2.6%.

Month-on-month, the CPI climbed 0.3%, following a 0.1% rise in November. Prices were expected to gain 0.4%.

Another data from ONS showed that input prices fell for the fifth straight month in December. Input prices dropped 1.55 annually after a 2.1% drop.

On a monthly basis, input prices edged up 0.1% compared to flat growth in November. Likewise, output prices gained 0.1% after November's 0.4% gain.

Data from Destatis showed Germany's wholesale prices increased for the first time in twenty months in December, rising 0.1% year-on-year, reversing a 0.6%. drop in November.

Eurozone industrial production expanded for the second straight month in November, figures from Eurostat revealed. Industrial output posted a monthly increase of 0.2% in November, the same pace as in October. Economists had expected a slightly higher growth of 0.3%.

On a yearly basis, the drop in industrial output deepened to 1.9% from 1.1% in October.

Data from the statistical office INSEE said France's consumer price inflation came in at 1.3% in December, the same as in November, and in line with the flash data published earlier this month.

Meanwhile, harmonized inflation edged up to 1.8% in December from 1.7% a month ago, as estimated. However, inflation remained below the European Central Bank's target of 2%.

On a monthly basis, consumer prices rose 0.2%, in contrast to the 0.1% decrease in November. The rate matched the flash estimate. Likewise, the harmonized index of consumer prices gained 0.2% after a 0.1% fall in the previous month.