The pan-European STOXX 600 index rose 0.5% to a closing high of 460.57 points
Savova, however, noted that mentions of inflation by STOXX 600 companies have risen by more than 400% over the past year, leaving them at an all-time high in absolute terms
"We agree with this view and expect inflation in the euro area to peak in 4Q and then to ease back toward the 1.5% area (or around 1% for core inflation)."
British retailer Marks & Spencer jumped 4.2% to a one-year high after it said it had traded well in the early weeks of the 2021-22 and that earnings would recover after reporting an 88% slump in full-year profit.
Global sentiment took a hit after a selloff in Chinese technology shares on worries that they will be de-listed from US bourses, while the number of coronavirus cases in Germany saw the biggest increase since Jan. 9.