- Israel and Palestine extend ceasefire
- Russia sends further aid to Ukraine
- UK inflation falls
- US inflation report due
FTSE 100: 0.38%
CAC 40: 0.40%
FTSE MIB: -0.08%
IBEX 35: 0.31%
Stoxx 600: 0.39%
European stocks were mostly higher as a ceasefire between Israel and Palestine was extended and as Russia sent more aid to Ukraine.
A ceasefire between Palestine and Israel has been extended by 24 hours in an attempt to reach a truce. The initial ceasefire started on Wednesday after a five-week conflict which has killed over 2,000 people in Gaza. It was expected to end on Monday at midnight but last-minute negotiations in Cairo resulted in the extension.
Plans to increase aid to Ukrainian refugees are set to go ahead, after Russia's Deputy Emergencies Minister Vladimir Stepanov said on Tuesday that his government regarded them as its priority task. Earlier last week, Russia sent a humanitarian convoy, carrying 2,000 tonnes of humanitarian aid, 69 mobile power generators and 54 tonnes of medicines among other things, to Eastern Ukraine.
UK, US inflation
The UK consumer price index (CPI) grew by 1.6% in the year to July 2014, down from 1.9% in June according to the Office for National Statistics, reflecting a combination of falling commodity prices and intense competition. The consensus estimate had been for an advance of 1.8%.
"Soft inflation is generally good news for consumers especially in a period of weak wage growth," said Centre for Economics and Business Research economist Alasdair Cavalla.
"The recent trend of weak inflation appears to be as much a global phenomenon as a purely UK one."
Cavalla added that recent signals suggest the Bank of England seems likely to wait until next year before raising the base rate.
The US also releases its inflation data later on Tuesday, which is expected to reveal that the headline rate eased back from 2.1% in June to 2% in July.
"US inflation, as measures by the CPI reading, is running very close to target [2%] which may soon increase the pressure on the Fed to hike interest rates earlier than it would like," said Alpari UK analyst Craig Erlam.
"That said, certain members have recently suggested that the Fed would allow inflation to run a little over target in an attempt to tackle the problem of slack in the economy, something I imagine Yellen would be very on board with."
Potentially providing some clues, on Wednesday the Federal Reserve releases the minutes of its 29-30 July policy meeting and the Bank of England publishes the minutes from its August gathering.
Maersk, Imperial Tobacco
A.P. Moeller-Maersk rallied after raising its full-year profit forecast, citing higher freight volumes and lower costs.
BHP Billiton slumped after announcing plans to create an independent company comprising its aluminium, coal, manganese, nickel and silver assets.
Imperial Tobacco advanced after reporting a 1% fall in nine-month sales, less than the 2% drop expected by analysts.
ThyssenKrupp edged higher after Handelsblatt reported that the German steelmaker wants to sell its stairways business and a submarine shipyard.
The euro fell 0.13% to $1.3347.
Brent crude futures rose 0.18% to $101.79 per barrel, according to the ICE.