This is CNBC's live blog covering European markets.

LONDON — European stock markets were higher Wednesday, with attention focused on earnings and central bank comments in the U.S.

The Stoxx 600 index was up by 0.3% at 11:55 a.m. BST, paring earlier gains. Utilities led sector gains, up 1.7%. Autos stocks were down by 0.77% after the release of grim PMI figures for Germany, which showed a deepening downturn in manufacturing output and plunge in business activity.

The euro was lower against currencies including the U.S. dollar and the Japanese yen as PMIs also came in well below expectations for the euro zone, as services activity fell into decline.

Globally, investors will be poring over California-based chip designer Nvidia's results to see how it performs against high Wall Street expectations after a stellar first quarter, with analysts expecting volatility in the stock.

The company's shares have soared nearly 200% this year on the buzz around its uses within artificial intelligence.

European tech stocks have rallied this week, climbing 2% on Tuesday, as investors also assess Microsoft's new bid to U.K. regulators for gaming giant Activision Blizzard, and chip firm Arm's filing for a Nasdaq listing.

The rise in long-dated U.S. Treasury yields, with the yield on the benchmark 10-year note hitting its highest level since 2007, eased Tuesday. Yields were also lower early Wednesday.

Speculation continues around whether Federal Reserve Chair Jerome Powell will strike a noncommittal tone in his speech in Jackson Hole on Friday, or give market-moving comments that are more or less dovish than previously expected.

Richmond Fed President Thomas Barkin said Tuesday there are new signs of a "reacceleration scenario" for the U.S. economy — with inflation remaining high and the economy strengthening — that could could make the case for further interest rate hikes. Retail sales and consumer confidence both remain resilient in the U.S.

Barkin added the recent rise in Treasury yields did not give him reason to think the Fed had tightened financial conditions too far, and that a 10-year yield over 4% was "appropriate."

It will be hard for central bankers meeting at the Jackson Hole symposium not to rattle the bond market, Altaf Kassam, head of investment strategy and research at State Street Global Advisors, told CNBC's "Squawk Box Europe."

"What they're desperate to avoid is a repeat of what happened in the early 80s where they called victory on inflation, started easing monetary policy and then inflation spiked back up in their face," he said.

"If history rhymes, which it often does, we're going to see them keep up the hawkish rhetoric, say that they're not done yet and definitely leave room open for further rate hikes on a data-dependent basis."

Bond yields fall after gloomy PMI data

European government bond yields fell Wednesday after a slew of weak economic data saw traders assess the interest rate trajectory for the European Central Bank and Bank of England.

The 10-year German bund, seen as a euro zone benchmark, was 12 basis points lower at 2.537% at 1:30 p.m. Berlin time. Yields move inversely to prices.

Bert Colijn, senior euro zone economist at ING, said the euro zone purchasing managers' index figures showed a "picture of deteriorating activity."

"The economy is cooling off significantly, but hawks on the ECB board will be tempted to push for one more hike as wage pressures are translating into elevated inflation pressures for services," Colijn said in a note.

Market pricing is currently split roughly 50-50 on the chance of a September ECB hike of 25 basis points.

U.K. government bonds also fell Wednesday, with the 10-year gilt yield down by 13 basis points to 4.514% and the 2-year gilt yield down by 14 basis points to 5%.

Paul Dales, chief U.K. economist at Capital Economics, said U.K. PMIs may not deter the BOE from one more hike, but held encouraging signs higher rates were working.

"The dual signs of weaker activity and easing price pressures give us a bit more confidence in our view that interest rates will peak around 5.50% rather the 6.00% priced into the markets before this release." Dales said.

— Jenni Reid

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Euro zone PMIs miss expectations as services contract

Euro zone business activity shrank more than expected in August as services activity contracted, flash purchasing managers' index figures from Hamburg Commercial Bank and S&P Global showed.

Output fell to a 33-month low of 47, down from 48.6 in July, deepening the move below 50 which marks contraction. Economists polled by Reuters forecast a reading of 48.5.

Manufacturing output fell for a fifth straight month, while services declined for the first time since December.

PMI figures also showed a worsening picturing in Germany and France.

Chris Williamson, chief business economist at S&P Global Market Intelligence, said the figures were even bleaker if pandemic years were excluded, with activity contracting at the fastest rate since 2013 in the euro zone and since 2009 in Germany.

"Germany is now leading that [euro zone] decline. Its manufacturing sector is in all sorts of trouble, facing a downturn in global demand. It's at the forefront of that pullback in investment goods expenditure as well as global de-stocking," he told CNBC's "Squawk Box Europe."

"But the big news this month really is the extent to which the service sectors are now joining in that downturn, they had been that pillar of strength earlier in the year, that's faded."

— Jenni Reid

German business activity falls at fastest pace since 2020

German business activity fell at its steepest rate since May 2020 in August as manufacturing output worsened and services activity declined, according to flash S&P Global purchasing managers' index figures.

Headline output fell for a fourth consecutive month, from 48.5 to 44.7. A reading below 50 indicates contraction.

Total inflows of new business and new export business both worsened, while higher fuel prices meant input costs rose for the first time in 11 months.

"Any hope that the service sector might rescue the German economy has evaporated. Instead, the service sector is about to join the recession in manufacturing, which looks to have started in the second quarter," said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.

"Our GDP nowcast model, which incorporates the PMI flash estimate, now indicates a deeper fall of the whole economy than it did before, at almost -1%."

— Jenni Reid

Europe stocks open higher

European stocks opened Wednesday higher, with the regional Stoxx 600 up by 0.46% at 8:15 a.m. BST.

France's CAC 40 and Germany's DAX both climbed 0.5% as the U.K.'s FTSE 100 traded 0.4% higher.

— Jenni Reid

CNBC Pro: These 2 'secular' growth stocks are likely to keep rising despite rate hikes, fund managers say

Shares of these two companies are likely to stay on their "secular" growth trajectory despite an increase in interest rates or a slowdown in global growth, according to several fund managers.

One of the companies said it expects a compounded annual growth rate of up to 19% over the next three years. The stock jumped nearly 15% in response and is up almost 75% this year, beating the broader tech sector.

CNBC Pro subscribers can read more about the two stocks and an alternative ETF play here.

— Ganesh Rao

Europe stocks: Here are the opening calls

European stock markets are heading for a higher open Wednesday, IG data showed.

The U.K.'s FTSE 100 was seen opening 17 points higher at 7,292, Germany's DAX up by 61 points to 15,768, and France's CAC 40 was on course to open 18 points higher at 7,262.

CNBC Pro: How strong is the U.S. consumer? Two investors weigh in, naming stocks to buy — and types to avoid

Recent data seems to suggest that Americans have so far been willing to spend, especially as inflation continues to fall.

But some companies say customers appear to be cutting back.

The implications could be significant, given that consumer spending accounts for about two-thirds of the U.S. economy.

On Friday, Jason Ware, chief investment officer at Albion Financial Group, and Brian Stutland, portfolio manager at Equity Armor Investments, presented their bull and bear cases, respectively, on CNBC's "Street Signs Asia."

They also named stocks to buy.

CNBC Pro subscribers can read more here.

— Weizhen Tan