LONDON – European equities rose slightly on Thursday as markets around the world reacted to the Federal Reserve’s latest outlook on the US economy.
The pan-European Stoxx 600 gained 0.2%, banks jumped 1.5%, while utilities lost 0.7%. The German DAX was the region’s leading performer and touched a historic record early on Thursday’s trade.
European markets are mostly following the positive global sentiment after comments from the Fed, which concluded a two-day meeting on Wednesday. Futures of U.S. stock markets rose Wednesday night during the night session, after the Fed said it currently does not expect to raise interest rates until 2023.
Fed Chairman Jerome Powell reiterated that the central bank wants to see inflation above its 2% target and a substantial improvement in the U.S. labor market before considering changes in rates or monthly purchases of good.
The Fed also said it expects to see gross domestic product grow 6.5% in 2021, before cooling in later years and inflation rising 2.2% this year, as measured by personal consumption spending.
In Europe, the Bank of England meets on Thursday, although no policy change is expected. Meanwhile, European markets will await the conclusion of the European Medicines Agency (EMA) safety review on the coronavirus vaccine developed by AstraZeneca and Oxford University. Its security committee meets Thursday.
German auto parts maker Varta rose 5.5%, while the country’s top lenders, Deutsche Bank and Commerzbank, added more than 4%.
At the end of the European Blue Chip Index, Swiss pharmacy Zur Rose Group fell more than 8% after its year-over-year profit report.
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