European markets moved higher on Friday to end a volatile week, as investors around the world assessed inflation and fears of an economic recession.

The pan-European Stoxx 600 index gained 1.4% by mid-morning, with tech stocks adding 1.7% to lead gains while retail stocks slid 1%.

In terms of individual share price movement, London-listed defense firm Ultra Electronics jumped more than 12% after the British government moved forward in the process of signing off a takeover of the company by rival Cobham.

At the bottom of the European blue chip index, German online retailer Zalando plunged more than 13% after issuing a profit warning for the second quarter, prompting a broad sell-off in retail stocks.

Central banks last week made aggressive moves to rein in inflation, and investors are now hopeful that rising consumer prices will be brought under control as commodities prices — notably oil and economic output bellwether copper — pulled back sharply in recent days. Energy and food have been the main drivers of inflation around the world.

However, this aggressive policy tightening path has stoked fears of a recession, which U.S. Federal Reserve Chairman Jerome Powell told Congress on Wednesday was a “possibility” as he reiterated that the central bank is “strongly committed” to bringing down inflation.

Weaker-than-expected euro zone business activity data on Thursday compounded fears that the bloc could be headed for a recession, and sent European stocks to a fresh 2022 low.

Shares in Asia-Pacific were higher overnight, led by Hong Kong’s Hang Seng index and South Korea’s Kospi. Stateside, stock futures gained in early premarket trade on Friday as Wall Street looked to grind out a rare positive week amid a challenging first half of the year.

On the data front in Europe, U.K. retail sales fell 0.5% month-on-month in May, slightly less than the -0.7% projected by economists in a Reuters poll, while April’s monthly rise in sales was revised down sharply from 1.4% to 0.4%.

U.K. consumer confidence fell to its lowest level since records began, new data from research company GfK revealed Friday, as the country faces inflation running at a 40-year high, slowing growth and a spiraling cost of living crisis for households.

The Ifo Institute’s business climate index for Germany fell to 92.3 in June from 93.0 in May, while business conditions and expectations also declined slightly.

Final data showed Friday that the Spanish economy expanded by 0.2% in the first quarter of 2022, slowing from a growth rate of 2.2% in the last quarter of 2021.

British Prime Minister Boris Johnson suffered a double blow overnight as his ruling Conservative Party lost two key by-elections to the main opposition Labour Party and to the Liberal Democrats.

The defeats in the two constituencies at opposite ends of England — seen as a litmus test of Johnson’s standing after the “partygate” scandal and amid the cost-of-living crisis — prompted the immediate resignation of Conservative Party Chairman Oliver Dowden.