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European stocks rally as Fed refrains from tapering; Dax jumps 1.17%

Published 09/19/2013, 03:38 AM
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Investing.com - European stocks opened sharply higher on Thursday, as risk sentiment was boosted after the Federal Reserve suprised investors by maintaining the current level of its asset-purchase program.

During European morning trade, the EURO STOXX 50 surged 1.52%, France’s CAC 40 gained 1.17%, while Germany’s DAX 30 jumped 1.17%.

European equity markets rallied after the Fed refrained on Wednesday from reducing the USD85 billion pace of its monthly asset purchases and said the central bank must determine its policies based on "what’s needed for the economy," even if it surprises markets.

Speaking after the conclusion of the Fed's two-day policy-setting meeting, Fed Chairman Ben Bernanke Bernanke said he wanted to "wait a bit longer and to try to get confirming evidence" that the economy is showing signs of lasting improvement.

Financial stocks were among the top gainers, as French lenders BNP Paribas and Societe Generale rallied 1.62% and 1.56%, while Germany's Deutsche Bank jumped 1.04%.

Among peripheral lenders, Spanish banks BBVA and Banco Santander gained 1.24% and 1.55% respectively, while Italy's Unicredit and Intesa Sanpaolo surged 3.08% and 3.34%.

Adding to gains, Germany's RWE advanced 1.59% after a tribunal in June awarded its unit partial reimbursement from Gazprom of about USD1.5 billion for payments made since May 2010.

Elsewhere, Telecom Italia was up 0.17% as directors were preparing to gather in Milan with Madrid-based Telefonica looking to resolve price differences to double its holding by buying out Assicurazioni Generali, Intesa Sanpaolo and Mediobanca.

In London, commodity-heavy FTSE 100 jumped 1.39%, supported by sharp gains in mining stocks.

Anglo American and Fresnillo saw shares surge 4.66% and 8.37% respectively, while Randgold Resources and Polymetal soared 8.58% and 13.51%.

Meanwhile, U.K. lenders were tracking their European counterparts higher, as Barclays climbed 0.88% and Lloyds Banking advanced 0.92%, while shares in HSBC Holding and the Royal Bank of Scotland rallied 1.04% and 2.13%.

In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.22% gain, S&P 500 futures signaled a 0.26% rise, while the Nasdaq 100 futures indicated a 0.26% increase.

Later in the day, the U.S. was to release the weekly report on initial jobless claims, as well as the Philly Fed manufacturing index and data on existing home sales.


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