European Stocks Rise on Easing Fed Hike Bets and Gold Price Surge

European stocks rose on Monday as investors grew more confident that the Federal Reserve won't raise interest rates soon. The pan-European STOXX 600 index was up 0.1% at 658.51 points by 8:23 am GMT.

The gains were led by basic resources, which climbed 1.1%, with Antofagasta, Hochschild Mining, and Fresnillo increasing between 1.9% and 2.3%. Gold prices also rose 0.4% after softer-than-expected U.S. economic data and a weaker dollar.

Technology stocks added to the gains, rising 1%, while energy sector jumped 0.1% as crude prices advanced. However, food and beverages was the worst-performing sector, falling 1.1%.

Analysts at Goldman Sachs had raised their 12-month target for the STOXX 600 on Friday, forecasting it to reach 695 points from its previous target of 660, implying a potential upside of around 5.5%. This prediction was based on resilient economic growth and strong corporate earnings.

According to Andrea Cicione, head of research at TS Lombard, there's a divergence between Europe and the U.S., with U.S. data softening while European data remains relatively strong, which should support European markets now that the earnings season is largely over. The focus is increasingly shifting to central bank decisions in September.