European shares rise as deal cheer lifts Aveva, Schneider

By Shreyashi Sanyal

(Reuters) -European shares rose for a fourth straight session on Tuesday, with Aveva jumping on a report that France’s Schneider was nearing a deal to buy out the company.

The pan-European STOXX 600 index had risen 0.3% by 0825 GMT, touching levels not seen in more than two weeks. Shares of British software maker Aveva Group Plc climbed 3.4% to top the benchmark index.

French industrial group Schneider Electric rose 0.3% after Sky News reported late on Monday that it was nearing a deal to take full control of Aveva for about 3.5 billion pounds ($4.1 billion).

Finnish forestry group Stora Enso added 1% after the company said it would sell its Maxau paper production site in Germany to Schwarz Group.

UBS Group AG rose 1.3% on plans to increase its dividend by 10% to $0.55 per share.

Most sectors were trading higher, with personal & household goods and travel & leisure up about 1% each.

The STOXX 600 retail index lost 1.1%, shedding the most among sectors. British online supermarket Ocado Retail, a 50:50 joint venture between Ocado Group and Marks & Spencer, said it expected a small sales decline over the full 2022 year.

U.S. INFLATION FIGURES ON TAP

All eyes will now be on the release of U.S. inflation numbers later in the day, with analysts expecting the print to show some signs of cooling.

“The fact is that two consecutive reports showing a sharp deceleration combined with last month’s goldilocks jobs report will be a really encouraging sign and could trigger a broader risk rebound in the markets,” said Craig Erlam, a senior market analyst at OANDA.

Sentiment appeared to be positive, although inflation in Europe is yet to show signs of peaking. The European Central Bank delivered a surprisingly large 75-basis-point interest rate hike last week, in the clearest sign yet that it will not budge in its fight against inflation.

The hike came at a time when European economies are tackling a cost of living crisis along with a looming energy crisis after Russia turned off its natural gas taps to Europe indefinitely.

A draft of the European Union plan showed on Monday that fossil fuel firms may have to share their excess profits to help European households and industries cope with red-hot energy bills.

(Reporting by Shreyashi Sanyal in Bengaluru; Editing by Saumyadeb Chakrabarty and Subhranshu Sahu)