LONDON — European stocks were slightly higher on Thursday, building on gains made in the previous session.
The pan-European Stoxx 600 was up 0.3% in early trade. Retail stocks were the standout performers, gaining 2.5%, while telecoms fell 0.4%.
The cautiously positive start for European stocks came after gains on Wednesday on the back of strong U.S. economic data that tamed investor fears of a looming recession. The ISM non-manufacturing purchasing managers index showed a surprise rebound in July also prompting U.S. stocks to climb.
The U.K.’s FTSE was muted on Thursday morning with the market jittery ahead of the Bank of England‘s next monetary policy decision. The central bank is broadly expected to hike interest rates by 50 basis points, its largest single increase since 1995.
Such a move would take borrowing costs to 1.75% as the central bank battles soaring inflation and would be the first half-point hike since it was made independent from the British government in 1997. The anticipated hike comes as U.K. inflation hit a new 40-year high of 9.4% in June.
Elsewhere overnight, Asia-Pacific shares traded higher on Thursday following the rally on Wall Street and as investors moved on from the tensions over U.S. House Speaker Nancy Pelosi’s controversial visit to Taiwan.
Meanwhile, U.S. stock futures were roughly flat on Thursday morning after the major averages snapped a two-day slide in the previous regular trading session.
Earnings before the bell came from Credit Agricole, Adidas, Bayer, Lufthansa, Merck, Zalando, Rolls-Royce, Next, Glencore and Adecco Group on Thursday.
Lufthansa shares climbed 6% to lead the Stoxx 600 after the German posted a smaller-than-expected quarterly loss.
At the bottom of the European blue chip index, Danish medical device company Ambu plunged 14% after cutting its margin forecast and announcing that it would lay off around 200 employees.
(With Inputs from cnbc)
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