FX.co ★ European Shares Gain As Inflation Worries Ebb

European stocks witnessed a slight increase on Monday, as Middle East conflicts began to subside and the continuous fall in oil prices gradually dispelled fears surrounding inflation and future interest rates.

The heightened appetite for risk among investors was fuelled after Iran and Israel executed 'measured' counterattacks, deliberately ensuring no causalities were suffered. This development has underlined the countries' disinterest in catalyzing a war, which could otherwise escalate the ongoing conflict.

In addition to geopolitical tensions, investors are looking forward to an array of US economic data and imminent tech earnings releases this week, which could provide critical directional guidance.

On Monday, the pan-European STOXX 600 edged up by 0.4 percent to 501.29, following its uneventful end to trading on Friday. Furthermore, Germany's DAX observed a growth of half a percent, whilst the French CAC 40 and the UK's FTSE 100 increased by 0.2 percent and 1.4 percent respectively. Positive endorsements from RBC Capital Markets spurred a rise in London-based retail stocks.

Among the winners, Marks & Spencer grew 3.3 percent and Ocado observed a 5.5 percent rise, while Sainsbury's shares rose 3.8 percent. Tesco noted a 2.8 percent increase after instigating the pioneer tranche of the £1 billion share buyback it declared at its results.

Shares in Tyman soared 30 percent as the company, a supplier of doors and windows, agreed to a £788 million cash-stock deal with Quanex, a US-based manufacturer of metal doors and windows. The Hipgnosis Songs Fund saw a 9.7 percent rise, following the potential $1.5 billion purchase offer made by Blackstone for the beleaguered music rights investor.