European stocks rose on Thursday, snapping three straight sessions of losses, as a global bond selloff eased and investors awaited U.S. jobs data for clues on the Federal Reserve's next move. Soitec led gainers after raising its revenue outlook, while luxury stocks lagged on caution over the sector's recovery.
The pan-European STOXX 600 was up 0.5% at 649.1, recovering from one-month lows hit on Tuesday. Regional indexes were also mostly higher.
Soitec jumped 10.3% to the top of the STOXX 600 after the French chip materials maker raised its revenue growth outlook for the second quarter of 2027 to 50% year-on-year from a previous forecast of 30%.
Oil and bond yields retreat from highs
Markets had come under pressure in recent days as the escalation of the Iran war lifted oil prices and amplified concerns over persistent inflation, rising government debt and tighter monetary policy. European equities are particularly exposed to higher oil prices given the region's reliance on energy imports.
Oil prices eased on Thursday but remained above $95 a barrel, while euro zone bond yields retreated from multi-year highs. The latest survey showed growth in the euro zone's dominant services industry slipped to a two-month low in August, though solid, broad-based demand kept overall private sector activity steady.
Traders are nearly certain the European Central Bank will raise borrowing costs to 2.5% at its policy meeting next week, and expect two additional quarter-point interest rate hikes by mid-2027. Friday's U.S. non-farm payrolls report will be closely watched for fresh signals on the Fed's policy path, after hawkish comments from Chair Kevin Warsh last week prompted traders to raise bets on further rate hikes.
Luxury names slide as media and bank stocks gain
Among other stocks, WPP and Publicis rose 5.6% and 4.4%, respectively, after a media report said Publicis had won PepsiCo's media account.
Luxury stocks led sectoral losses, falling 2% as investors grew more cautious about the outlook for the industry's recovery. LVMH fell 1.8%, while Hermes and Gucci-owner Kering dropped about 2% and 3%, respectively.
Commerzbank gained 2.3% after the German lender announced a new share buyback programme of up to €1.2 billion ($1.39 billion). Deutsche Telekom added 1.1% after Elliott built a stake in the company.
Source: Investing.com
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