European shares post best trading in 6 weeks on cyclical sector

European stocks closed with gains for a second straight session on Wednesday (11), with momentum from strong balance sheets and a rise in economically sensitive sectors after US inflation slowed sharply in April.

The pan-European STOXX 600 index closed up 1.74% at 427.59 points and posted its biggest daily percentage gain since late March. Mining companies, automakers and oil and gas companies rose more than 3% each.

The pick-up in mood came on the heels of a sharp sell-off in global equity markets this month on fears that aggressive monetary tightening and lockdowns in China will fuel an economic slowdown, pushing the STOXX 600 to a two-month low on Monday. This month, the index has already dropped 5%.

Data showed that US consumer price growth slowed sharply in April, with gasoline prices off record highs, a sign that inflation had likely peaked. But it is likely to remain high for a while, which keeps the Federal Reserve on a path of raising rates.

“As the dust settled, traders focused on the fact that both inflation and core had cooled in the month, which removed much of the fear about the prospect of big rate hikes,” said David Madden, market analyst at Equiti. Capital.

• In London, the Financial Times index advanced 1.44%, to 7,347.66 points;
• In Frankfurt, the DAX index rose 2.17% to 13,828.64 points;
• In Paris, the CAC-40 index gained 2.50% to 6,269.73 points;
• In Milan, the Ftse/Mib index appreciated by 2.84%, at 23,724.20 points;
• In Madrid, the Ibex-35 index registered an increase of 2.13%, to 8,312.60 points;
• In Lisbon, the PSI20 index rose by 1.21%, to 5,789.96 points.