European markets climb 18 as travel stocks gain a boost

European markets climb 1.8% as travel stocks gain a boost

LONDON – European markets were higher in morning trade as investors assessed China’s reopening and awaited key European inflation numbers.

Britain’s FTSE 100 rose 2.1%, while Germany’s DAX index and France’s CAC 40 both rose about 1.4%.

Overall, the pan-European Stoxx 600 rose 1.8%, led by travel stocks, up 3.1%.

Germany’s preliminary inflation figures for December are due Tuesday afternoon, followed by France’s on Wednesday and Italy’s on Thursday.

UK markets were closed on Monday but shares across the rest of the continent rose as euro-zone manufacturing data suggested the worst may be over for the 20-member currency bloc.

The numbers offered hope of a light at the end of the tunnel after a year of recession fears as central banks around the world aggressively hiked interest rates to curb rising inflation.

Meanwhile, markets in Asia-Pacific were mixed overnight as investors weighed the near-term impact of China’s surge in coronavirus infections against the potential longer-term boost from the full reopening of the world’s second-largest economy.

The Caixin Purchasing Managers’ Index showed further declines in factory activity due to rising Covid infections, but the survey also brought business confidence on the 12-month outlook for production to its highest level since February 2022.

Global investors will also be following the minutes of the December Fed meeting, due to be released on Wednesday.

The central bank raised interest rates by 50 basis points in December after four consecutive hikes of 75 basis points, and markets will be anxious to gauge the likely trajectory of monetary policy in 2023.