FTSE 100 up 0.79%; DAX up 0.55%; CAC 40 up 0.48% (Il Sole 24 Ore Radiocor) - Milan, 12 Jun - European shares were moderately higher in cautious midday trade, rebounding from yesterday's losses. The Stoxx 600 index was up 0.50%.

Investors remained on the sidelines as they awaited a Federal Reserve policy decision later today, with the US central bank expected to keep rates steady and offer more cues its future rate path.

A stronger-than-expected US jobs report released on Friday showed that hiring and wage growth picked up in May, rekindling concerns over US interest rates. The figures prompted investors to dial back hopes for an early Fed rate cut.

Traders also awaited key consumer price index data due today before the Fed's decision. The figures are expected to show inflation remained sticky in May, giving the Fed little impetus to start slashing rates.

On the data front, the UK's economic growth was flat in April as construction output dropped for a third straight month and industrial output fell sharply. The reading was in line with expectations but lower than March's 0.4% expansion.

In Germany, inflation rose in May driven by higher services prices, the Federal statistics office said, confirming preliminary data. In May, consumer prices in Germany rose a monthly 0.1% and increased an annual 2.4%, according to data released by the federal statistical office Destatis that confirmed its preliminary figures. CPI rose 2.2% year on year in both April and March. The harmonized index of consumer prices, used for European Union purposes, was up a monthly 0.2% and an annual 2.8%, also in line with the preliminary figures.

Last week, the European Central Bank cut rates by 25 basis points for the first time since 2019 as widely expected by the markets, but did not commit to a particular path in the coming meetings. Despite a hike in inflation forecasts, investors still believe the ECB is likely to cut interest rates in September.

The region's stock markets dropped in the previous sessions as political uncertainty kept sentiment in check after the latest European Union elections showed a broader shift towards right-wing and far-right parties and French president Emmanuel Macron called for snap legislative elections later in June following his party lagged Marine Le Pen's far-right party in the EU vote.

At 1125 GMT, the London FTSE 100 was up 0.79% at 8,213 points, the Frankfurt DAX was up 0.55% at 18,498 points, the Paris CAC 40 up 0.48% at 7,828 points, while in Milan the FTSE MIB rose 0.49% at 34,252 points, and in Madrid the IBEX 35 was up 0.29% at 11,220 points.

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(RADIOCOR) 12-06-24 13:41:59 (0369) 5 NNNN