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European Markets Close Higher, Touch 1-Year Peak After U.S. Inflation Data; Bond Yields Jump

European Markets Expected to Open Mixed; Investors Await U.S. CPI Data
Reuters

This is CNBC's live blog covering European markets.

European markets ended a choppy session 0.1% higher Tuesday after U.S. inflation grew slightly more than expected, taking the Stoxx 600 to touch a one-year high.

The pan-European index was initially flat following the CPI data release, shedding the morning's modest gains. But by the late afternoon it had rebounded to trade 0.6% higher before pulling back.

The index is up more than 9% in the year to date amid a stronger than expected earnings season and improved economic forecasts, with the euro zone now widely expected to avoid a recession. 

Telecoms stocks finished up 1.7% to lead gains as chemicals dropped 0.4%. The Coca-Cola Hellenic Bottling Company was the top riser among European stocks, up 5% after reporting record results.

Meanwhile, German engineering firm ThyssenKrupp fell 10.4% after its finance chief admitted its free cash flow and slow pace of restructuring were issues for the company.

During the morning, the U.K.'s FTSE 100 index hit yet another intraday record high, of 7,996 points, but ended the day at 7953.8.

The U.S. consumer price index rose 0.5% for the month, translating into an annual gain of 6.4%. The increase was slightly higher than economists estimated, according to a survey by Dow Jones, though the pace of inflation fell again.

Bond yields were also volatile after the print, with short-data U.K. government bond yields jumping 18 basis points to a near four-month high while German bonds rose by 5.6 basis points before falling.

In the U.S., benchmark 10-year Treasurys fell to a session low of 3.622%, rose to a session high of 3.759%, then traded flat on the day at 3.7206%. U.S. stocks, meanwhile, fell at the open, which came shortly after the data release.

Asia-Pacific markets closed mixed on Tuesday as Japan reportedly announced its nomination of Kazuo Ueda as the new Bank of Japan governor. He is set to succeed Haruhiko Kuroda, if confirmed by the country's parliament.

European markets close slightly higher

Europe's Stoxx 600 closed 0.1% higher, with the pan-European index hitting a one-year high during a choppy session.

Investors globally have been processing the latest U.S. inflation print, which was hotter than expected but showed a slight decline in the rate of price rises.

Major bourses were largely flat, with France's CAC 40 up 0.07% and Germany's DAX down 0.11%.

The U.K.'s FTSE 100 ended the day up 0.08% after hitting a record high earlier in the session.

— Jenni Reid

U.K. two-year bond yields jump

Yields on two-year U.K. government bonds were up 16 basis points on the previous day at 3:30 p.m. London time following the U.S. inflation print.

The 3.8% short-dated gilt yield is the highest level since Oct. 21, the day after Britain's short-lived Prime Minister Liz Truss said she would resign, according to a Reuters analysis.

The rise outpaced that in two-year U.S. Treasury notes, which were up 6 basis points, and German two-year Bunds, which rose 3 basis points.

— Jenni Reid

U.S. stocks open lower after stubbornly high inflation report

U.S. stocks fell at Monday's open after the January consumer price index, a measure of inflation, was slightly higher than expected.

The Dow Jones Industrial Average fell 87 points, or 0.26%. The S&P 500 slipped 0.52%, and the Nasdaq Composite ticked 0.80% lower. Treasury yields were also largely flat following the inflation report.

—Carmen Reinicke

Bilfinger meets expectations for revenue, cash flow

Thomas Schulz, CEO of Bilfinger, discusses the company's fourth-quarter and full-year numbers.

Siemens CEO: We need a bureaucracy reduction act

Christian Bruch, CEO of Siemens Energy, speaks to CNBC's Dan Murphy at the World Government Summit in Dubai.

Thyssenkrupp shares drop 6% on first-quarter results

German engineering and steel production company Thyssenkrupp was at the bottom of the pan-European Stoxx 600 index after reporting results of what its CFO described as a "challenging" first quarter.

The company reported a lower order intake and adjusted EBIT (earnings before interest and taxes) than the previous year, as forecast, and shares tumbled 6.2% at the start of trading.

— Hannah Ward-Glenton

UK unemployment rate stays at 3.7%

The rate of unemployment in the U.K. remained unchanged at 3.7% in the three months to December, according to data released by the Office for National Statistics.

The rate remains close to the lowest level the country has seen in 50 years, which was 3.5% in the three months to August 2022.

British Finance Minister Jeremy Hunt said the figure was "an encouraging sign of resilience in our labour market" in a statement, Reuters reported.

— Hannah Ward-Glenton

Here are the opening calls

Britain's blue-chip FTSE 100 index will open 4 points up at 7,946, according to IG data, and Italy's MIB will also make gains, up 7 points to 27,476. France's CAC is set to slide 1 point to 7,212, while Germany's DAX looks ready to drop 23 points to 15,384.

— Hannah Ward-Glenton

All eyes on Tuesday's consumer price index data

Investors will be watching for the closely-followed consumer price index data coming Tuesday morning.

The January data for the index, which gauges the pace of inflation through tracking changes in prices within a broad basket of items, is due at 8:30 a.m. Here's what economists polled by Dow Jones expect:

  • CPI will be up 0.4% compared with the prior month and 6.2% higher than the same month a year ago.
  • So-called "core" CPI, which excludes food and energy, will be up 0.3% month-over-month and 5.5% higher than the same month one year prior.

Based on those expectations, the report could deliver some bad news. CNBC Pro subscribers can read more about how some market observers expect stocks to move based on what the latest data shows.

Beyond CPI, investors will also be watching for the latest bath of corporate earnings from consumer-focused names such as Coca-Cola and Airbnb. CNBC Pro subscribers can see what to expect for the entire week here.

— Alex Harring

Japan nominates Kazuo Ueda for next Bank of Japan governor: Reuters

The Japanese government nominated Kazuo Ueda for its next Bank of Governor, Reuters reported, citing documents that the government submitted to parliament.

The government also nominated Ryozo Himino and Shinichi Uchida for the deputy governor roles, the report said.

The Japanese yen was little changed following the reported nomination, and last traded at 0.2% stronger levels at 132.15 against the U.S. dollar.

– Jihye Lee

CNBC Pro: Morgan Stanley is bullish on this Chinese tech giant — giving it upside of nearly 20%

Investors have been flocking back into Chinese tech stocks amid China's reopening and an easing of regulatory headwinds.

Morgan Stanley has doubled down on its "buy" call on one Chinese tech giant, and raised its price target on the stock. Its bullishness comes hot on the heels on a similar call by Goldman Sachs.

Pro subscribers can read more here.

— Zavier Ong

CNBC Pro: Yields are popping. Here's how investors can take advantage of that, according to the pros

Yields are popping again.

"Markets are coming round to the threat that the Fed will maintain a 'higher for longer' stance if sequential pick-up in prices, despite the continued moderation in [year-on-year] inflation, is pronounced," Vishnu Varathan, head of economics and strategy at Mizuho Bank, said Monday. He added there was also the threat of hot jobs data for January.

"This could underpin the run-up in UST yields, alongside a Greenback that is discernibly more buoyant (than it has been late-Jan into start-Feb); whilst continuing to dampen, if not drag, equities," he added.

How can investors ride on higher yields? Here's what the pros say.

CNBC Pro subscribers can read more here.

— Weizhen Tan

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