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Europe midday: Shares hold gains in rally ahead of rate calls

Wed 17 December 2025 11:42 | A A A

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(Sharecast News) - European stocks rallied on Wednesday despite a mixed showing on Wall Street overnight as investors awaited the final central bank rate decisions of the year.

The pan-regional Stoxx 600 index was up 0.32% to 581.7 with all regional bourses higher.

Britain's FTSE 100 surged more than 1.5% after an unexpected fall in inflation, boosting hopes of a rate cut from the Bank of England on Thursday. Markets expect a 25-basis point cut to 3.75%.

Official data published Wednesday showed inflation cooled to 3.2% in November, down from 3.6% a month earlier, buy still well above the target level of 2%. The pound fell 0.72% to $1.33 against the US dollar in response to the news.

In the US, major indices turned in a mixed performance on Tuesday as traders digested key payrolls data that had been delayed by the Federal government shutdown.

At the close, the Dow Jones Industrial Average was down 0.62% at 48,114.26, while the S&P 500 shed 0.24% to 6,800.26, and the Nasdaq Composite saw out the session 0.23% firmer at 23,111.46. The Dow closed 302.30 points lower on Tuesday, extending losses recorded in the previous session.

Tuesday's primary focus was both October and November's non-farm payrolls figures, which revealed the US added 64,000 jobs in November, compared with a 105,000 loss in October and market expectations of a more modest increase of 50,000.

Back across the pond, the European Central Bank set to hold its final policy meeting of the year on Thursday where it is widely expected to keep rates at 2%, ECB President Christine Lagarde said it was likely to lift its euro zone growth forecasts again. In September, it had raised its annual GDP growth forecast to 1.2%.

Sweden's Riksbank and Norway's Norges Bank will also hold their last monetary policy decisions for 2025 this week.

In Germany, business sentiment unexpectedly deteriorated in December, according to a survey released on Wednesday by the Ifo Institute.

The business climate index fell to 87.6 from 88.0 in November, missing expectations for a reading of 88.2. The current situation index was unchanged in December at 85.6, while the expectations index dipped to 89.7 from 90.5.

In equity news, shares in UK government outsourcer Serco gained after the company lifted guidance for 2025, citing contract wins.

Reporting by Frank Prenesti for Sharecast.com

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