Europe midday: Shares rally on CPI data; Grifols, ITV, Daimler in focus

(Sharecast News) - European shares were peering at the summit of new highs on Friday as falling inflation in the eurozone and US cheered investors.

The pan-regional Stoxx 600 index was up 0.48% to 497, while Germany's DAX index continued to power ahead with a 0.68% gain to 17,786.

Markets were boosted by news that the US personal consumption expenditures price index (PCE) slowed to 2.4% for the year to January, down from December's 2.6% rise. The core PCE index that excludes energy and food edged down to 2.8% from the 2.9% readout in December.

"The figures were met with some relief, especially given recent CPI and PPI readings which came in hotter than expected, thus igniting fears of a reacceleration of inflation," said Interactive Investor head of markets Richard Hunter.

"The news provides the potential for an interest rate cut in June to still be on the table, even if at the broadest level there are few signs of a weakening US economy, let alone one which is veering towards recession."

Consumer prices in the eurozone rose by more than expected in February, according to data out on Friday from Eurostat, but core inflation continued its downward trend, falling to its lowest in nearly two years.

The year-on-year change in the harmonised index of consumer prices was 2.6% last month, down from 2.8% in January but above the 2.5% change expected by economists. Economists had expected a fall to 2.5% on the headline number.

In equity news, the roller-coaster ride of shares in Grifols continued as they jumped 15% on news that the Spanish pharma company's $1.8bn sale of a 20% stake in Shanghai RAAS will proceed after a due diligence process concluded "satisfactorily".

Grifols said the sale to Haier Smart Home, announced in late December, would complete by the end of the first half of this year provided all the regulatory hurdles are cleared.

Swedish games maker Embracer Group surged on reports it was selling its Saber Interactive unit in a $500m deal.

UK broadcaster ITV also soared after announcing it was selling its 50% stake in streaming service Britbox International to BBC Studios for £225m.

German truck maker Daimler also motored after lifting its sales outlook and dividend.

Kuehne+Nagel fell to the bottom of the Stoxx as the logistics giant reported a 48% fall in net earnings last year.

Reporting by Frank Prenesti for Sharecast.com