By Twesha Dikshit
(Reuters) -European shares rose on Tuesday, as a U.S.-China tariff truce extension aided sentiment, while investors awaited U.S. inflation data to gauge the impact of tariffs on price pressures and monetary policy path.
The pan-European STOXX 600 index was up 0.2%, as of 0900 GMT.
Italy's FTSE MIB rose 0.5%, leading modest gains across regional markets, while Germany's DAX dipped 0.1%.
Investors were relieved after Washington and Beijing extended a tariff truce by 90 days, staving off
triple-digit duties on each other's goods until November 10, and setting the groundwork for a meeting between U.S. President Donald Trump and Chinese President Xi Jinping later this year.
"The fact that they're still talking and there seems to be a will on both sides is important and I think that is good news for the world economy," Premier Miton Investors Chief Investment Officer Neil Birrell said.
"We're celebrating things not being quite as bad as they could have been, which is the way the market operates at times."
Meanwhile, Trump said both Kyiv and Moscow will have to cede land to end the war ahead of his summit with Russian President Vladimir Putin on Friday. Hopes of a Ukraine peace deal have buoyed European stocks in recent days.
Data later in the day is expected to show U.S. consumer prices likely increased moderately in July, though rising costs for goods like household furniture and apparel because of tariffs probably resulted in a measure of underlying inflation posting its largest gain in six months.
Soft economic data in recent weeks and a shake-up at the Federal Reserve have stoked expectations of as many as two interest rate cuts from the U.S. central bank this year.
Technology stocks were the laggards on the day, down 1%, with U.S. tech major Nvidia slipping in U.S. premarket trading, after a report said that Chinese authorities have urged local companies to avoid using Nvidia's artificial intelligence chips.
Spirax Group was the top gainer on the STOXX 600, surging 13%, after the British manufacturing group's first-half results beat expectations.
Sartorius rose 3.6% after Jefferies upgraded the pharmaceutical equipment supplier's stock rating to "Buy" from "Hold".
Vestas Wind Systems gained 4.1% after receiving orders in the U.S. for undisclosed projects.
Conversely, Derwent London shares dropped 4.4% and were the top decliners on the STOXX 600 after reporting lower first-half earnings.
(Reporting by Twesha Dikshit and Sruthi Shankar in Bengaluru; Editing by Rashmi Aich)
