LONDON – European equities rose slightly higher on Thursday as markets around the world reacted to the latest outlook from the Federal Reserve for the US economy.
The pan-European Stoxx 600 gained 0.2%, with banks jumping 1.5%, while utilities lost 0.7%. The German DAX was the standout player in the region, hitting an all-time high early in Thursday’s trading.
European markets are largely following positive global sentiment following comments from the Fed, which closed a two-day meeting on Wednesday. US stock futures rose during the overnight session on Wednesday evening, after the Fed said it currently does not expect to hike interest rates until 2023.
Fed Chairman Jerome Powell reiterated that the central bank wants to see inflation consistently above the 2% target and a material improvement in the US labor market before considering changes in interest rates or its monthly bond purchases.
The Fed also said it expects gross domestic product to grow 6.5% in 2021, before cooling in later years and inflation rising 2.2% this year as measured by personal consumption. expenses.
In Europe, the Bank of England will meet on Thursday, although no policy change is expected. Meanwhile, European markets await the conclusion of the European Medicines Agency (EMA) safety review on the coronavirus vaccine developed by AstraZeneca and the University of Oxford. The safety committee will meet on Thursday.
German auto parts maker Varta climbed 5.5% while the country’s largest lenders, Deutsche Bank and Commerzbank, both added more than 4%.
At the lower end of the European blue chip index, Swiss online pharmacy Zur Rose Group was down more than 8% after its full-year earnings report.
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