European Markets Surge Awaiting U.S. Inflation Data

European stocks climbed on Thursday with gains led by the personal goods and household sectors. Investors are now keenly observing U.S. inflation data to anticipate the Federal Reserve's interest rate move. German inflation numbers also indicated the potential for future ECB rate changes.

European shares extended gains on Thursday as earnings updates continued to stream in, though the market's focus shifted towards U.S. inflation data for insights on the Federal Reserve's potential first interest rate cut.

The pan-European STOXX 600 index rose by 0.2%, driven primarily by the personal goods and household sectors. However, all eyes are on the forthcoming U.S. consumer prices data at 1230 GMT (08:30 a.m. ET), anticipated to show a reduction in headline inflation to 3.1% in June from 3.3% in May.

German inflation also eased to 2.5% in June, corroborating preliminary findings and raising the possibility of another European Central Bank rate cut in September. Among notable stock movements, British water company Pennon surged by 5.8% after appointing insider Laura Flowerdew as its new CFO, succeeding Steve Buck. On the downside, Swiss chocolate maker Barry Callebaut fell by 7.1%, despite reporting higher sales volumes over the nine months ending in May, as surging cocoa prices impacted demand. Portugal’s Galp Energia declined by 3.1% following a 'underweight' rating downgrade and target price reduction by Morgan Stanley.