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European stock markets attempt rebound at open

written by Bella Palmer
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London's benchmark FTSE 100 index was up 1.0 per cent to 7,131.03 points, while DAX gained 0.9 per cent to 15,238.16 points and the CAC 40 added 0.9 per cent to 6,779.40

European stock markets attempted to rebound in opening deals on Wednesday, in a rollercoaster week that has been jarred by concerns over the economic impact of the Omicron coronavirus variant.

In initial trade, London's benchmark FTSE 100 index was up 1.0 per cent to 7,131.03 points.

In the eurozone, Frankfurt's DAX gained 0.9 per cent to 15,238.16 points and the Paris CAC 40 added 0.9 per cent to 6,779.40.

Investors enter the final month of the year in reflective mood, as the Omicron variant adds to the list of concerns on the wall of worry, said Richard Hunter, head of markets at trading firm Interactive Investor.

He added: Even though there is insufficient information on the latest variant fully to assess the impact, there is an increasing feeling that any fallout would be less severe than that seen in the initial pandemic.

Global stocks and oil had sunk Tuesday as Moderna warned current vaccines might be less effective at fending off Omicron.

Sentiment was also hit as data showed that eurozone inflation spiked to a record high on runaway energy costs in November.

The Bank of England was always expecting inflation to overshoot its target this spring, but it has taken the position that this is a short-term blip caused by rock-bottom prices a year earlier, and as soon as they naturally fall out of the figures, inflation will drop away again, said Sarah Coles, personal finance analyst at Hargreaves Lansdown.

She said: It isn’t worried by the rise and it isn’t expecting to raise interest rates in the immediate future to bring it back down again.

On the data front, November’s final manufacturing purchasing manager’s index (PMI) reading for the euro zone came in at 58.4, a slight improvement on October’s 58.3 but short of an initial 58.6 flash estimate.

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