LONDON: Stock markets mostly rose on Thursday as traders shook off concerns about soaring inflation in the United States.

Europe's main equity indices finished higher after gains in Asia's major markets.

On Wall Street, the Dow Jones Industrial Average was down 0.1 percent in midday trading while the S&P 500 and tech-heavy Nasdaq were up.

The major US markets had closed lower for a second straight day on Wednesday as data showed the US consumer price index hit a 31-year high last month, putting fresh pressure on the US Federal Reserve to act to prevent inflation from running out of control.

Fed officials have insisted that the jump in inflation will be temporary as the global economy slowly returns to a semblance of normality next year.

Thursday's gains on the stock markets "would suggest investors are not too convinced the Fed will change course at its next policy meeting in December, even though inflation signals have really tested the central bank's 'transitory' term", said ThinkMarkets analyst Fawad Razaqzada.

"The market may perhaps give the Fed that extra bit of doubt just in case we might have seen peak inflation," Razaqzada said.

Investors fear that the Fed could raise interest rates to tame runaway inflation.

Oliver Allen, analyst at Capital Economics, said US equities have likely "shrugged off" this year's surge in inflation "because it has not coincided with either a rise in the real yields of (US) Treasuries or weakness in corporate earnings".

The prospect of a potential rate hike helped the dollar rise against other major currencies, while oil prices rebounded after dropping over inflation concerns.

OPEC lowered its forecast for growth in world oil demand in 2021 due to weaker demand in major consumers China and India, and higher energy prices.

While central bankers have sought to ease concerns over inflation, observers said the pain is far from over.

"We're going to see the inflation picture get worse before it gets better," said Sarah House at Wells Fargo & Co.

   **- Mixed GPD picture -**

The growth outlook was also in focus as Brussels on Thursday raised its forecast for eurozone output this year.

At the same time, official data showed Britain's economic recovery slowed sharply in the third quarter on supply constraints as countries reopen after pandemic lockdowns.

London's FTSE 100 index, however, closed 0.6 percent higher.

Back in Asia, Bloomberg News reported that Evergrande had again stumped up the cash for interest on bonds, slightly easing concerns about its imminent collapse and potential contagion outside China.