European stock markets were higher Thursday morning amid hopes that the drama over the U.S. debt ceiling was entering its final stages.
The benchmark Stoxx 600 was up 0.9% in morning trade, pulling away from its lowest level for two months. Most sectors gained, with media, bank, and auto stocks all up 1.5% and mining stocks up 1% after Chinese factory activity beat expectations. Utilities, which have benefited from recent uncertainty, slipped 0.2%.
On the data front, investors are analyzing flash euro zone inflation figures, which showed inflation falling more than anticipated. The consumer price index was up 6.1% from the previous year, which was less than the 6.3% anticipated by economists polled by Reuters. Inflation was at 7% in April.
Flash readings this week from Germany, France, and Spain all showed slowdowns in price rises, significantly more than expected by analysts. Italian inflation came in higher than forecast but still declined.
The bill to raise the U.S. debt limit and cap government spending passed by 314-117 in the House of Representatives late Wednesday. Lawmakers hope it will now clear the Democratic-controlled Senate within 48 hours, ahead of the June 5 deadline for avoiding a potential default.
It follows weeks of political wrangling that has weighed on markets but not sparked broad panic, with a deal always considered the most likely outcome. U.S. stock futures were slightly lower overnight.
The Stoxx 600 fell 3.19% in May, according to Eikon data, amid uncertainty over the strength of China’s economic rebound and shifting rate hike expectations.
May was also notable for a rally in technology stocks. Better-than-expected results from U.S. chipmaker Nvidia briefly sent the company to a $1 trillion valuation and took the Nasdaq Composite index to a 5.8% monthly gain. European tech and key players such as ASM International also saw a boost, with the sector up 6.71% for the month.
Source: https://www.cnbc.com/2023/06/01/european-markets-open-to-close-earnings-data-and-news.html
