Title: European Stocks Higher; China's COVID News, Spanish Inflation in Focus
May 30, 2022 04:10AM ET
European stock markets traded higher on Monday, supported by gains in Asia as major Chinese cities begin to ease mobility restrictions, while elevated Spanish inflation puts pressure on the European Central Bank.
At 4:10 am EDT, Germany's DAX was trading 0.8% higher, France's CAC 40 was up 0.9% and Britain's FTSE 100 was up 0.5%.
European stock markets received a positive boost from Asia, with Japan's Nikkei and Hong Kong's Hang Seng up more than 2%, helped by news that movement restrictions in key areas of China were eased over the weekend.
Shanghai plans to lift a two-month COVID freeze on June 1, while Beijing reopened some parts of public transport and some shopping malls on Sunday after infections stabilised.
Tight restrictions on movement in major Chinese cities have hit hard the economy of the country, which is the world's second-largest market and a key export market for many European companies.
Still, gains are likely to be limited on Monday as it is the holiday season in the United States and annual consumer inflation in Spain unexpectedly increased to 8.7% in May from 8.3% in the previous month.
The latest flash estimate of inflation in the eurozone will be released on Tuesday and is expected to hit another record high of 7.7% in May, up from 7.4% in April, although Spanish data point to further growth.
A significant growth would very much validate the expectations of ECB policy normalization, which is supposed to begin in the summer.
In corporate news, S4 Capital shares rose 2.3% after the advertising group reported a sharp rise in first-quarter gross profit and reiterated its outlook for the full year, in which it expects strong demand despite forecasts of slowing global economic growth.
Shares in Ted Baker rose 2.5% on news that Juicy Couture Owner Authentic Brands is close to taking over the British fashion house for 300 million pounds ($379.35 million).