Overview

European stocks rose on Tuesday after moderate US inflation data bolstered bets that the Federal Reserve will refrain from raising interest rates this week, while mining stocks rose as metal prices surged after the how China lowered interest rates.

The Stoxx 600 closed up 0.6%, tracking the impact of growth in global financial markets.

US Inflation Data

And US consumer prices posted a modest rise in May and the lowest annual inflation rate increase in more than two years, raising expectations that the US central bank will leave interest rates unchanged tomorrow, Wednesday, Reuters reported.

“Right now, markets are leaning toward the US central bank not raising (interest rates),” said Steve Sosnick, chief strategist at Interactive Brokers.

Upcoming ECB Meeting

The European Central Bank will hold a monetary policy meeting on Thursday and is expected to raise interest rates by another 25 basis points to curb inflation.

Sector and Stock Analysis

The tech sector index rose 1.4% and mining stocks jumped 2.7% to their highest level in 7 weeks.

Industrial metal prices rose after China’s central bank on Tuesday cut interest rates on short-term loans for the first time in 10 months.

Among individual stocks, Danish company Maersk jumped 4.6% after it said it received the fuel needed for the first carbon-neutral methanol-powered container ship on its maiden voyage from South Korea to Denmark.

Admiral shares fell 5.1% after traders said Citi downgraded the rating of the British home and car insurance company.