Investing.com - European stocks opened sharply higher on Friday, after the European Central Bank announced a much larger than expected stimulus package on Thursday, although ECB President Mario Draghi said the bank does not intend to cut rates further.
During European morning trade, the EURO STOXX 50 jumped 2.06%, France’s CAC 40 rallied 2.24%, while Germany’s DAX 30 surged 2.11%.
European stocks rallied after the ECB cut interest rates across the euro zone to new record lows and boosted its quantitative easing program on Thursday.
The ECB wrong footed markets by cutting its benchmark interest rate to a record-low of zero from 0.05%. Market watchers had been expecting no change.
The central bank also cut the deposit facility rate deeper into negative territory, to minus 0.4% and cut the marginal lending rate cut to 0.25% from 0.30%.
In addition, the ECB boosted its quantitative easing program by €20 billion per month to €80 billion, starting in April.
European equities lost some ground however after Draghi said that the ECB did not anticipate that it will be necessary to reduce interest rates further, but added that this could change.
Financial stocks were sharply higher, as French lenders Societe Generale (PA:SOGN) and BNP Paribas (PA:BNPP) surged 3.74% and 4.67%, while Germany’s Deutsche Bank (DE:DBKGn) and Commerzbank (DE:CBKG) rallied 3.30% and 3.46%.
Among peripheral lenders, Italy’s Unicredit (MI:CRDI) and Intesa Sanpaolo (MI:ISP) soared 5.30% and 4.38% respectively, while Spanish banks BBVA (MC:BBVA) and Banco Santander (MC:SAN) jumped 2.58% and 3.13%.
Elsewhere, Sanofi (PA:SASY) SA rallied 1.61% after saying that its and U.S. company Regeneron Pharmaceuticals Inc (NASDAQ:REGN).’s experimental rheumatoid arthritis therapy helped patients more than AbbVie Inc (NYSE:ABBV).’s Humira in a late-stage trial.
In London, FTSE 100 jumped 1.50%, as U.K. lenders tracked their European counterparts sharply higher.
Shares in HSBC Holdings (LON:HSBA) gained 1.31% and Lloyds Banking (LON:LLOY) rallied 2.35%, while the Royal Bank of Scotland (LON:RBS) and Barclays (LON:BARC) surged 2.75% and 3.38% respectively.
Mining stocks were also broadly higher on the commodity-heavy index. Anglo American (LON:AAL) advanced 1.21% and Bhp Billiton (LON:BLT) gained 1.99%, while Rio Tinto (LON:RIO) and Glencore (LON:GLEN) climbed 2.30% and 2.66% respectively.
Meanwhile, Aviva (LON:AV) Plc remained one of the top performers on the index for a second consecutive session, with shares up 4.23% after the U.K. insurer reported on Thursday a Solvency II ratio of 180%, disclosing its capital strength under new European Union rules for the first time, and raised its dividend by 15%.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.88% gain, S&P 500 futures a 1.02% jump, while the Nasdaq 100 futures indicated a 1.26% rally.