European markets close higher with China reopening, economic outlook in focus

LONDON — European markets closed higher Friday, as investors hope for a Chinese economic recovery as Covid-19 curbs are relaxed, while assessing the prospects for a global recession. The pan-European Stoxx 600 index closed up 0.8%, with construction and material stocks adding 1.8% to lead gains. Oil and gas stocks pared earlier losses to end the session marginally negative. U.S. stocks moved between gains and losses Friday as worries over continued rate hikes persisted. After a relatively muted week for European stock markets, a host of significant risk events are coming down the pike next week, including the U.S. Federal Reserve and Bank of England’s next monetary policy meetings. The Fed is expected to issue a 50 basis point interest rate hike — smaller than the last four increments of 75 basis points — but investors are increasingly concerned about whether the central bank can avoid a recession next year in its attempt to rein in inflation. The Hang Seng Index led gains in Asia-Pacific as China inflation data came in roughly in line with expectations. In remarks published by state media on Thursday, Chinese Premier Li Keqiang said the country’s