European Shares Seen Up Ahead Of US Inflation Data

(RTTNews) - European stocks may open a tad higher on Thursday as investors remain optimistic about the U.S. inflation report due out later in the day.

The report is expected to show a slowdown in the annual rate of consumer price growth and could lead the Federal Reserve to ease its pace of rate hikes.

A separate report on weekly jobless claims may also provide additional clues on the state of the U.S. labor market.

U.S. jobs data released last week provided evidence of a still tight labor market but a slowdown in wage growth provided some relief for Fed officials.

Asian markets traded mixed, with Chinese and Hong Kong stocks declining on worries that the expected rush to return home for the Lunar New Year could spread the COVID virus in rural areas with underdeveloped health care infrastructure.

China's consumer inflation accelerated in December while factory-gate inflation narrowed, data released earlier in the day showed. That leaves China's central bank room to ease policy and bolster the economy.

Gold prices rose in Asian trade as a weaker dollar made bullion more appealing to other currency holders. The dollar's slide comes after Boston Federal Reserve bank leader Susan Collins said that she was leaning towards a 25-basis point hike.

Oil extended recent gains to hit a one-week high on expectations for an improved global economic outlook.

U.S. stocks rallied overnight, as Treasury yields dropped on hopes that cooling inflation could give the Federal Reserve room to dial back on its aggressive interest rate increases.

The tech -heavy Nasdaq Composite surged 1.8 percent to notch its first four-day winning streak since September, while the Dow rose 0.8 percent and the S&P 500 added 1.3 percent to reach their best closing levels in almost a month.

European stocks edged higher on Wednesday amid optimism surrounding China reopening and signs that inflation may have peaked in Europe.

The pan European STOXX 600 gained 0.4 percent. The German DAX climbed 1.2 percent, France's CAC 40 advanced 0.8 percent and the U.K.'s FTSE 100 edged up 0.4 percent.