European stocks advanced on Thursday following a 50-basis point rate cut by the U.S. Federal Reserve, which signaled further easing and fueled hopes of a soft landing for the U.S. economy.
All eyes now turn to the Bank of England’s monetary policy announcement, due at 7:00 AM ET. While the central bank is expected to hold off on cutting interest rates due to unfavorable economic conditions, investors are focusing on the pace of its quantitative tightening. The bank may announce a further GBP 100 billion reduction in gilt holdings over the next twelve months.
The pan-European STOXX 600 index rose by 1 percent to 519.62, recovering from a 0.5 percent decline the previous day. Germany’s DAX gained 0.9 percent, France’s CAC 40 surged 1.5 percent, and the UK’s FTSE 100 climbed 1 percent.
In the mining sector, shares of Anglo American, Antofagasta, and Glencore jumped between 3-4 percent, boosted by rising base metal prices.
British retailer Next advanced 2.2 percent after increasing its annual profit forecast, while online grocer Ocado soared 7.2 percent on upgraded revenue guidance.
In banking, Close Brothers saw a gain of over 1 percent after announcing the sale of its wealth management division, Close Brothers Asset Management (CBAM), to a private equity firm.
Automakers such as Renault, Volkswagen, and Mercedes Benz posted gains of 1-3 percent despite a sharp drop in European car sales, which fell by 18.3 percent year-over-year in August. The decline was primarily attributed to a slump in electric vehicle sales, according to the European Automobile Manufacturers’ Association.
