FX.co ★ European Stocks Rebound

European equities advanced on Friday as easing energy prices helped temper the recent surge in inflation concerns. The Euro STOXX 50 rose 0.4% to 6,296, while the STOXX Europe 600 gained 0.3% to close at 638.5. Sovereign bond yields paused their sharp climbs from earlier in the week, with the retreat in natural gas prices alleviating fears of intensifying inflationary pressures as the fourth quarter begins.

Bank stocks rebounded after several sessions of underperformance, with UniCredit, Deutsche Bank, and ING rising between 1% and 3%. Shares with exposure to AI software and infrastructure also recovered, mirroring the continued momentum seen in the US; ASML, Infineon, and Prosus each climbed more than 1.5%.

On the macroeconomic front, German consumer sentiment deteriorated more than expected heading into October, as elevated energy costs weighed on households’ income expectations.