Optimism surrounding potential interest rate reductions buoyed market sentiment on Friday, leading to robust upward trends in major European stock markets, thereby maintaining their recent positive momentum.
Federal Reserve Governor Christopher Waller stated in an interview with CNBC on Thursday that should inflation continue to decline as anticipated, the U.S. central bank might implement multiple interest rate cuts this year.
Meanwhile, within Europe, ECB Governing Council member Yannis Stournaras expressed on Thursday the necessity for ongoing policy support through a series of rate cuts in forthcoming meetings. Market analysts predict the European Central Bank (ECB) will execute a 100-basis point reduction this year.
Germany's DAX surged 248.00 points, marking a 1.20 percent rise to close at 20,903.39. London's FTSE soared 113.32 points or 1.35 percent, settling at 8,505.22, while France's CAC 40 climbed 75.01 points, a 0.98 percent increase, concluding at 7,709.75.
In Germany, Siemens Energy experienced a 3.06 percent increase, Heidelberg Materials escalated by 3.02 percent, and Daimler Truck Holding rose by 2.00 percent. Deutsche Post moved up by 1.98 percent, Deutsche Bank advanced by 1.74 percent, Infineon Technologies gained 1.72 percent, although Merck decreased by 1.40 percent. BASF edged up by 0.68 percent, while Deutsche Borse and Volkswagen each increased by 0.52 percent, and Deutsche Telekom remained unchanged.
In London, Entain made significant gains of 6.29 percent, Smiths Group surged 5.50 percent, and Prudential increased by 4.93 percent. Scottish Mortgage advanced by 2.45 percent, British American Tobacco strengthened by 1.75 percent, Rolls-Royce Holdings rose by 1.59 percent, and EasyJet improved by 1.31 percent. Haleon increased by 0.97 percent, Rightmove by 0.49 percent, and Vodafone Group by 0.12 percent.
In France, Carrefour faced a decline of 4.95 percent, and Atos fell by 4.76 percent. Conversely, Veolia Environment soared 2.24 percent, Engie gained 1.55 percent, while Vivendi decreased by 1.01 percent. Danone increased by 0.87 percent, with Credit Agricole and Sanofi both rising by 0.32 percent. Societe Generale increased slightly by 0.07 percent, with BNP Paribas up by 0.05 percent.
Economic updates revealed a unexpected decline in UK retail sales in December, primarily due to decreased food store sales, according to the Office for National Statistics on Friday. Retail sales volume fell by 0.3 percent month-on-month in December, contrasting a revised 0.1 percent rise in November, and defying expectations for a 0.4 percent increase.
Eurostat confirmed that Eurozone inflation reached a five-month peak in December, initially estimated. The harmonized consumer price index rose by 2.4 percent year-on-year, following a 2.2 percent increase in November, marking the fastest growth since July when prices increased by 2.6 percent. Core inflation—excluding energy, food, alcohol, and tobacco costs—remained steady at 2.7 percent in December.
The European Central Bank announced on Friday that the Eurozone's current account surplus decreased to a three-month low in November. The surplus fell to EUR 27 billion from EUR 30 billion in October, marking the smallest surplus since August, when it was EUR 23.5 billion.
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