European stocks experienced an upswing on Wednesday as investors awaited crucial U.S. inflation data and a Federal Reserve policy decision, both pivotal in shaping future interest rate expectations.
The euro remained stable while French 10-year bonds broke a four-day losing streak.
Yields on eurozone government bonds decreased after reaching seven-month highs on Tuesday, spurred by Moody's warning of a potential downgrade on French debt.
In economic updates, Germany reported an increase in consumer price inflation for the first time in five months in May, as confirmed by final data from Destatis.
The consumer price inflation rate climbed to 2.4 percent in May, up from April's stable 2.2 percent growth, the lowest in three years. This figure was consistent with earlier flash data.
In contrast, EU-harmonized inflation rose to 2.8 percent from 2.4 percent, aligning with estimates.
In the U.K., the economy stagnated in April due to a rise in services output being offset by declines in production and construction, according to the Office for National Statistics.
The gross domestic product (GDP) remained flat month-on-month, as anticipated, following a 0.4 percent increase in March. Over the three months leading up to April, real GDP grew by 0.7 percent compared to the previous quarter.
The pan-European STOXX 600 gained 0.5 percent to reach 519.61, recovering from a 0.9 percent decline on Tuesday.
Germany's DAX increased by 0.4 percent, France's CAC 40 rose by 0.2 percent, and the U.K.'s FTSE climbed 0.6 percent.
Bank stocks traded higher, with French banks BNP Paribas and Credit Agricole advancing between 1-2 percent.
Rentokil shares surged nearly 12 percent in London following Trian Fund Management's acquisition of a significant stake in the pest-control firm.
Legal & General dropped 3.1 percent as the company's new CEO delineated plans to restructure the business into three core units.
Landore Resources soared 51 percent after successfully raising £3.683 million through a subscription of new shares.
Swedish construction company Skanska AB saw a 0.5 percent increase.
The company announced the divestiture of the multi-family rental project Horkær Have in Herlev, Denmark to NREP for approximately 737 million Danish Kroner, or about 1.1 billion Swedish kronor.
