FTSE 100 up 0.32%; DAX down 0.05%; CAC 40 up 0.54% (Il Sole 24 Ore Radiocor) - Milan, 12 Jul - European shares opened mostly higher in cautious trade, extending yesterday's gains, with the Stoxx 600 index up 0.23%.

Investors digested key US data showing that inflation in the world's biggest economy had fallen more than expected in June to 3% annually, down from 3.3% in May, rekindling hopes of an interest rate cut this year.

Dovish comments from Federal Reserve chair Jerome Powell earlier this week spurred optimism over a soft landing for the US economy.

According to the CME FedWatch Tool, the market is now pricing in a 91% chance the Fed cuts rates in September compared to a 75% chance just a day ago.

US stock futures pointed to a muted open after the S&P 500 index suffered yesterday its worst session since April, retreating from its 37th record close this year. Traders are now US producer price figures due later today.

German, French and Spanish inflation readings were also on tap today.

Caution prevailed in the region this week amid prospects of a hung parliament in France after a surprise win last Sunday for the country's leftwing coalition, the New Popular Front (Nouveau Front Populaire). The bloc won the second round of the general election, thwarting an expected surge of the far-right, but failed to secure an absolute majority.

The French election results came after a general election in the UK last week that saw the opposition Labour Party win a landslide victory as expected, ending 14 years in power for the Conservative Party.

Today in European stock market dealings most sectors were higher, with telecoms shares leading the gains while tech stocks slid as they tracked their US peers lower.

At 0730 GMT the London FTSE 100 was up 0.32% at 8,249 points, the Frankfurt DAX was down 0.05% at 18,530 points, the Paris CAC 40 up 0.54% at 7,668 points, while in Milan the FTSE MIB was up 0.48% at 34482 points, and in Madrid the IBEX 35 was up 0.15% at 11,186 points.

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(RADIOCOR) 12-07-24 10:03:12 (0196) 5 NNNN