European markets head for higher open following gains on Wall Street

  • European stocks are expected to open in positive territory on Thursday, following gains on Wall Street after the latest U.S. inflation reading.
  • London's FTSE is seen opening 17 points higher at 7,202, Germany's DAX up 29 points at 15,847, France's CAC 40 up 4 points at 6,861 and Italy's FTSE MIB 60 points higher at 26,493, according to IG.

LONDON — European stocks are expected to open in positive territory on Thursday, following gains on Wall Street after the latest U.S. inflation reading.

London's FTSE is seen opening 17 points higher at 7,202, Germany's DAX up 29 points at 15,847, France's CAC 40 up 4 points at 6,861 and Italy's FTSE MIB 60 points higher at 26,493, according to IG.

The uptick in sentiment in Europe comes after the Dow Jones Industrial Average and the S&P 500 rose on Wednesday, after U.S. data showed that inflation jumped, but not by quite as much as investors feared when stripping out volatile food and energy prices.

July's Consumer Price Index (CPI) released Wednesday showed prices rose 5.4% since last year, compared to expectations of 5.3%, according to economists surveyed by Dow Jones. The government said CPI increased 0.5% in July month over month

But investors were concentrating on the core rate of inflation, which could signal inflation will remain tempered and the economy will remain strong. CPI, excluding energy and food prices, rose by 0.3% last month, below the 0.4% increase expected. Core prices still jumped 4.3% year over year.

The inflation reading supported the Federal Reserve's belief that high price pressures are "transitory" as the economy recovers from the pandemic-triggered recession.

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Meanwhile in Asia-Pacific, mainland Chinese stocks edged higher in early trade on Wednesday, tracking gains seen in other major Asia-Pacific markets after Wall Street highs. Oil stocks in the region also jumped on the back of higher oil prices.

OPEC releases its latest oil market report for August on Thursday, while earnings come from Zurich Insurance, Delivery Hero and RWE. On the data front, the latest reading of U.K. gross domestic product for the three months to June will be closely watched and euro zone industrial production figures for June are due.

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– CNBC's Maggie Fitzgerald, Pippa Stevens and Weizhen Tan contributed to this market report.

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