European shares rise 1% following corporate updates

The pan-European STOXX 600 index was trading at a two-week high of 519.42 points

European shares jumped 1% on Wednesday, driven by a slew of corporate updates, while heavyweight ASML led overall gains on report that the Dutch chip equipment manufacturer would be exempted from a new U.S. rule on foreign chip equipment exports.

The pan-European STOXX 600 index was trading at a two-week peak of 519.42 points, as of 0821 GMT. The benchmark index has added 1.5% so far this month.

Shares of ASML soared 6% after Reuters reported that a new U.S. rule on foreign chip equipment exports to China would exempt some allies, including the Dutch manufacturer.

The regional tech sector gained 2.7%.

The aerospace sector traded 1% higher, with Airbus jumping 4% after the world's planemaker unveiled its second-quarter results.

French benchmark CAC 40 Index added 1%.

On the data front, French inflation accelerated to 2.6% in July, but was still below forecast.

Euro zone flash inflation data for July is due at 0900 GMT and will provide traders hints on the ECB's policy stance. Markets are expecting two more 25-basis-point rate cuts this year and have priced a 65% probability of a September rate cut, shows LSEG data.

The markets are betting on a September rate cut by the European Central Bank and an in-line European inflation figure plus the Fed keeping the door open to its first cut in September will solidify those, said Ben Laidler, head of equity strategy at Bradesco BBI.

Meanwhile, the Fed will conclude its two-day policy meeting where investors expect the U.S. central bank to lay out groundwork for a September cut.

Fed chair Jerome Powell keeping the door open to a first September cut is equally as important to the ECB as the domestic inflation figures, Laidler said.

Among other central banks, the BoE's monetary policy committee will meet on Thursday to take a call on British borrowing costs.

Other notable stocks moves include HSBC Holdings' around 3.4% gain as the bank pledged to buy back $3 billion in shares after it reported a steady first-half profit.

Wolters Kluwer declined 4.5% after the Dutch information services firm reported its first-half results.

British drugmaker GSK declined 1.8% after it missed vaccine sales in the second quarter.