European shares rebound after bond rout, inflation fuels rate worries
EWG•European shares rebounded 0.6% after a sharp bond-driven selloff, while euro zone inflation rose more than expected in September. Investors weighed the inflation data and prospects for further interest-rate increases.
1. Shares recover
The pan-European STOXX 600 rose 0.6% to 630.47 points by 1005 GMT on Friday, after touching its lowest level in more than three months on Thursday. Technology shares led sectoral gains, rising 2.1%, while European bank stocks fell 0.3%.
2. Inflation and rates
Euro zone inflation surged more than expected in September and is likely to rise further in the coming months, keeping pressure on the European Central Bank to raise rates again. The ECB lifted rates last month, and traders were pricing in an 81.8% chance of a December hike.
3. Company moves
Julius Baer rose 2.3% after announcing a share buyback programme of up to 600 million Swiss francs. Commerzbank fell 1.4% after RBC downgraded its rating to “sector perform” from “outperform.”
