European stocks advanced on Monday, following a positive trend set at the end of last week and overnight in Asia-Pacific markets.
The pan-European Stoxx 600 climbed 1.9% by mid-afternoon, with retail stocks jumping 4.4% to lead gains as all sectors and major bourses traded in positive territory.
European stocks took heart last week from the hawkish tone struck by the European Central Bank on monetary policy, as policymakers look to rein in record high inflation in the 19-member euro zone. The momentum continued on Monday.
Global markets are gearing up for the latest reading of U.S. inflation, with the August data set to be released Tuesday.
The report is one of the last pieces of data on inflation the U.S. Federal Reserve will see ahead of its September meeting, where the central bank is expected to deliver its third consecutive 0.75 percentage point rate hike in an effort to combat high inflation.
Fed Chair Jerome Powell reiterated last week that he is “strongly committed” to bringing down inflation.
U.S. stock futures climbed on in premarket trade on Monday, while shares in the Asia-Pacific rose in overnight trading on improved risk sentiment. Mainland China, Hong Kong and South Korea markets are closed for a holiday.