European shares inched higher on Thursday on hopes fresh coronavirus-related curbs and restrictions may not be needed going into the new year, even as a surge in COVID-19 cases due to the Omicron variant kept a lid on gains.

The pan-European STOXX 600 rose 0.2%, after edging 0.1% lower on Wednesday, with the tech sector and defensives, including healthcare and real estate, in the lead.

Spain’s IBEX was flat after flash data showed consumer prices in December rose 6.7% across the country from the same month last year, the fastest annual pace of inflation since 1989.

The index has underperformed its regional peers in 2021, gaining a slim 7%, compared with the STOXX 600’s 22% rise.

Meanwhile, France’s CAC 40 has eclipsed the benchmark’s gains in 2021, as hopes of an economic recovery saw luxury stocks shine, even though outlook for demand from Asia remains bleak into the new year.

The blue-chip index surged 29% in 2021, eyeing its best year in over two decades, beating even the S&P 500’s 27% rally.

“The CAC 40 has a higher concentration of value stocks, which were all hammered in 2020 at the expense of pharma and tech, or growth sectors,” said Jeffrey Halley, senior market analyst at OANDA.

“The recovery, particularly in the second half of 2021, has flowed through to value sectors. In a rising interest rate and inflation environment, value should outperform,” Halley added.

The FTSE MIB climbed up  by 0.05% to 27,358.20. In the cash markets, the DAX  Germany was trading  down by 0.08%  to 15,840.65. CAC 40  in France  rose by 0.13% to 7,170.37 while the FTSE 100  in the U.K. was  down by 0.04% to 7,418.35 ,at the time of writing.