By Anisha Sircar

(Reuters] European shares rose slightly on Friday after regaining some of the ground that was lost from last session’s almost 2% slump. This is due to European Central Bank’s hawkish decision this summer not to inject money into financial markets.

The pan-European index grew 0.6% to record its first week of gains in four.

As rising inflation outweighed worries about Russia’s incursion into Ukraine, Thursday’s ECB decision allowed for an increase in interest rates. U.S. data shows that prices increased to 7.9% in February. This is the highest rate of growth in over 40 years.

Mark Haefele (chief investment officer, UBS Global Wealth Management) stated that central banks are less able to absorb shocks in equity markets as they did over the past years.

According to the Bank of America, investors fled Europe at the fastest rate ever recorded. They pulled $13.5 billion out of European stocks. The war forced them into hiding in safe havens like cash and gold.

Haefele stated that, “Though our core case still calls for a ceasefire, a reduction of hostile rhetoric between Russia, NATO, and the summer,” this outcome seems far off.

Goldman Sachs (NYSE -) downgraded Thursday’s 2022 growth projections for the euro area to 2.5% instead of 3.9%. The reason? Concerns about an escalation in Russia-Ukraine crises.

The biggest gains were in oil stocks, which rose 1.5%. This week was their best since January 2013. Crude prices were volatile due to volatility caused by a supply shock resulting from the Ukraine war, and renewed efforts to supply the market. [O/R]

Tod’s gained 3.6%, as the Italian fashion industry expressed optimism for 2022 despite the global uncertainties. Atlantia shares rose 1.1% after Atlantia stated that it expects core profit to rise by 27% by 2024.

EssilorLuxottica gained 3.5% following the report of its luxury eyewear business, which reported that it had achieved its highest quarter in 2021. All regions saw an increase in sales over pre-pandemic.

German specialty chemicals manufacturer Lanxess saw 2.9% growth after it released a quarterly profit outlook that exceeded expectations.