European stocks rise amid expectations of interest rate cuts

European stocks rose on Wednesday amid expectations of a cut in interest rates following data on slowing inflation in Britain and Germany, while rising commodity prices led to a rise in resource stocks.

According to Reuters, the STOXX 600 index rose 0.3% by 0818 GMT, and shares of the energy and communications sectors were the biggest winners.

Data showed a decline in producer prices in Germany more than expected in November, and inflation in Britain fell last month much more than expected to the low level recorded by core inflation in September 2021, which strengthened expectations of lowering interest rates.

The German DAX index rose 0.2% and the British Financial Times 100 index rose 1.3%, while energy stocks rose 1.1% and basic resource stocks rose 0.4% due to the rise in the prices of most basic commodities.

Telefonica (BME:TEF) shares jumped 6.3%, with the Spanish government preparing to acquire about 10% of the shares of the giant telecommunications company.

Deutsche Post (ETR: DHLn) shares fell 1.3 percent after its American counterpart FedEx (NYSE: FDX) lowered its revenue expectations for the whole year and announced lower-than-expected quarterly profits.