European stocks rise but head for sharp weekly declines

European stocks experienced a modest increase on Friday, but they appear set for a significant downturn over the coming week due to soaring bond yields and concerns about imminent interest rate hikes, according to wire reports. The pan-European STOXX 600 index gained 0.3% to 637.60 points by 0716 GMT, marking a low point two months after the European Central Bank raised interest rates as expected and issued a warning of higher inflation, driven by escalating energy costs following an extended Middle East conflict.

Oil prices maintained a level above $100 for the third consecutive day, while the European Central Bank's aggressive approach has fueled calls for further rate increases. Global government bond yields, including the US 10-year Treasury yield, which serves as a key benchmark for international borrowing costs, have risen and hovered near the 5% threshold.

Investors are particularly focused on the upcoming US Consumer Price Index data, which could offer valuable insights into the Federal Reserve's interest rate strategy ahead of a crucial monetary policy meeting scheduled for the following week. Among individual stocks, Italian semiconductor testing company Technoprobe saw a notable surge of 4.7%, driven by strong August revenue reported by its major customer, TSMC.