European markets close higher as another report suggests cooling U.S. inflation

U.S. stocks opened higher Tuesday, buoyed by another report which suggested inflation could be slowing.

The Dow Jones Industrial Average rose 1% in early deals while the S&P 500 was up 1.7%. The Nasdaq Composite also jumped 2.6%.

The produce price index, a measure of wholesale inflation, rose 0.2% for the month, versus the consensus estimate for a 0.4% increase from Dow Jones.

— Karen Gilchrist

The producer price index, a measure of wholesale inflation, rose 0.2% in October on a month-over-month basis. Economists polled by Dow Jones expected an increase of 0.4%.

The report comes less than a week after the consumer price index report showed a lighter-than-expected increase as well, stoking optimism that inflation could be easing.

— Jeff Cox

The ZEW economic research institute said Tuesday that its economic sentiment index rose to -36.7 in November from -59.2 in October, well above a Reuters consensus projection of -50.0.

The improvement in German investor morale, though the outlook remains negative, was likely down to hopes that inflation rates will soon begin to fall from their record highs in the euro zone, ZEW President Achim Wambach said.

"In this case, policymakers would not have to hit the brakes on monetary policy as hard and/or for as long as feared."

- Elliot Smith

Shares of French call center company Teleperformance climbed more than 8% by mid-afternoon to lead the Stoxx 600 after Citigroup upgraded the stock to "buy" from "neutral."

At the bottom of the index, Danish health care equipment company Ambu plunged more than 17% after reporting a quarterly loss.

- Elliot Smith

Sven Schneider, chief financial officer of Infineon, discusses decarbonization and digitalization.

The U.K.'s tight labor market cooled slightly in the third quarter as the economy went into contraction.

Unemployment came in at 3.6% in the three months to September, up from an almost five-decade low of 3.5% registered between June and August.

Data from the Office for National Statistics indicated that payrolled employees grew by 74,000 in October to an all-time high of 29.8 million, though jobless claimant numbers rose slightly over the month.

Job vacancies declined for a fourth straight quarter, but remained at historically high levels, while pay growth increased, signaling persistent inflationary pressures.

Daniel Mahoney, U.K. economist at Handelsbanken, said the latest figures highlight that the U.K. labour market continues to pose a "headache" for policymakers.

"The growth in inactivity rates is an especially concerning problem given that has been observed much more strongly in the U.K. compared to many of its G7 counterparts. This goes some way to explaining why the U.K.'s economic performance following the pandemic has been lackluster, with its GDP still below pre-crisis levels," Mahoney said.

"Growth in inactivity has also been feeding inflationary pressures as it has contributed to employers all too often struggling to hire staff. As the U.K. heads into recession, the Bank of England now has a tricky balancing act between suppressing any signs of domestically-led inflationary pressures and ensuring that the downturn is not unnecessarily protracted."

- Elliot Smith

Shares of French call center company Teleperformance climbed more than 5% to lead the Stoxx 600 after Citigroup upgraded the stock to "buy" from "neutral."

At the bottom of the index, Danish health care equipment company Ambu plunged more than 11% after reporting a quarterly loss.

- Elliot Smith

Credit Suisse on Tuesday announced that it would accelerate the restructure of its investment bank by selling a significant portion of its securitized products group (SPG) to Apollo Global Management.

Credit Suisse said the transaction, along with the potential sale of other assets to third-party investors, is expected to reduce SPG assets from around $75 billion to $20 billion.

The bank said the move represented an "important step towards a managed exit from the Securitized Products business, which is expected to significantly de-risk the investment bank and release capital to invest in Credit Suisse's core business."

Read the full story here.

- Elliot Smith

China's industrial production grew 5% in the month of October compared with a year ago, slowing from an increase of 6.3% seen in September. The latest figure misses estimates of a 5.2% rise predicted in a Reuters poll.

Separately, retail sales in China fell 0.5% in October from a year ago, missing expectations.

Analysts polled by Reuters expected a 1% increase, and retail sales grew 2.5% in September.

— Abigail Ng

Which stocks could benefit if China rolls back its zero-Covid policy? Market pros reveal how to play a reopening as China eases some of its virus controls.

Pro subscribers can read more here.

— Zavier Ong

With many stocks in a bear market, equities could be undervalued by 15%, according to Morningstar.

The equity research firm's chief U.S. strategist believes headwinds that were present earlier in the year will start to recede at the start of next year and benefit stocks.

Dave Sekera also shared his "fair value" assessment on six companies with a "wide economic moat" that will outperform in such an economic environment.

CNBC Pro subscribers can read more here.

— Ganesh Rao

European markets are set to open mixed Thursday.

The U.K.'s FTSE 100 index is expected to open 17 points higher at 7,872, Germany's DAX up 5 points at 17,789, France's CAC 10 points lower at 7,983 and Italy's FTSE MIB down 8 points at 32,963, according to data from IG.

Earnings are set to come from Nokia, Easyjet and ABB. Data releases include new European car registration figures for March.

— Holly Ellyatt