European markets kick off October trading on a high note; euro zone inflation data in focus

LONDON — European stocks kicked off October trading in positive territory after ending September on a somber note.

The pan-European Stoxx 600 was slightly higher, up 0.13%, by 9:08 a.m. London time. Sectors and major bourses diverged, with tech stocks adding 0.9%, while household goods shed 0.97%.

Shares of German chemicals group Covestro rose to the top of the European benchmark, up 3.5%, after Abu Dhabi's national oil company Adnoc agreed to acquire it for 14.7 billion euros ($16.3 billion). Meanwhile, British bakery chain Greggs fell 3.96%, as sales growth showed signs of cooling.

The wobbly start to October comes after European stocks closed lower on Monday, with almost all sectors and major bourses in negative territory.

Investor focus on Tuesday will be centered on preliminary inflation data from the euro zone for September. Preliminary harmonized German inflation data released on Monday showed the country's consumer price index eased to 1.8% in September, down from 2% in August. The reading had been forecast to come in at 1.9%, according to a Reuters poll of economists.

The figures are likely to boost the chances of another interest rate cut from the European Central Bank. Last week, preliminary data showed the harmonized inflation rate in both France and Spain plunged below the ECB's 2% target in September.

U.S. stock futures were little changed on Monday evening, after the S&P 500 closed at a record to end September.

Investors also reacted to comments by Federal Reserve Chair Jerome Powell who said on Monday that the central bank is "not on any preset course" when it comes to the next steps for rate policy. He said to expect two more cuts this year — that is, a quarter percentage point each — if the economy performs as