EUROPE PULSE

European equities rebound as softer energy costs ease inflation pressure

Risk tone improved across Europe, led by Germany and technology, while lower oil prices offered relief to rate-sensitive sectors. The setup remains selective as inflation is still above target and geopolitical energy risks persist. ([ec.europa.eu](https://ec.europa.eu/eurostat/web/products-euro-indicators/w/2-19082026-ap?utm_source=openai))

Europe Drivers What Matters Now

BROAD EUROPE

STOXX Europe 600 stabilises after recent weakness

Improved business activity and softer energy costs are supporting a cautious rebound, though the weekly tone remains fragile.

GERMANY / DAX

German equities lead as growth data improves

DAX leadership reflects stronger Q2 activity and improving German business seclicals and industrials.

ECB / RATES

ECB remains on hold amid renewed energy inflation

Policy is data-dependent as July euro-area inflation rose to 2.9% and the ECB monitors second-round energy effects. ([ec.europa.eu](https://ec.europa.eu/eurostat/web/products-euro-indicators/w/2-19082026-ap?utm_source=openai))

ENERGY / SECTORS

Lower oil supports travel, leisure and European duration

Retreating cru-term inflation risk and improve operating conditions for fuel-sensitive sectors.

EURO-AREA MACRO

Growth rebounds, but inflation limits policy relief

Euro-area GDP expanded 0.4% quarter-on-quarter in Q2, while inflation remains above the ECB’s 2% objective. ([ec.europa.eu](https://ec.europa.eu/eurostat/web/products-euro-indicators/w/2-14082026-ap?utm_source=openai))

Current web sources: Annual inflation up to 2.9% in the euro area - Euro indicators - Eurostat · GDP up by 0.4% and employment up by 0.1% in the euro area - Euro indicators - Eurostat