Thursday saw European stock markets close with gains. London’s market notably surged after the Bank of England (BoE) Governor, Andrew Bailey, hinted at a positive shift towards interest rate cuts.
This announcement sparked optimism, pushing the FTSE index to an 11-month peak. Concurrently, Frankfurt’s exchange hit a new high.
The positive trend mirrored Federal Reserve (Fed) Chair Jerome Powell’s confirmation of upcoming U.S. rate reductions. This bolstered investor sentiment further.
The FTSE 100 in London leaped by 1.88%, closing at 7,882.55 points. Frankfurt’s DAX rose by 0.88%, reaching a record of 18,178.47 points.
Meanwhile, Paris’s CAC 40 bounced back, up 0.22% to 8,179.72 points.
At the BoE’s recent meeting, a shift occurred. Two members, previously pro-hike, opted to keep rates steady at 5.25%, aligning with most predictions.
The vote ended with eight in favor of this stance and one advocating for a 25 basis-point reduction.
This decision propelled British bank stocks upward. Standard Chartered, Lloyds, and Natwest saw gains of 2.77%, 2.96%, and 3.10%, respectively.
Elsewhere in Europe, the Swiss National Bank surprised many by reducing its key rate to 1.5%.
This move led the Swiss SMI index to climb by 0.73%, closing at 11,703.66 points. The Partners Group financial firm stood out, rising over 4%.
Other European markets also saw uplifts. Madrid‘s Ibex 35 increased by 1.22% to 10,884.10 points.
Milan’s FTSE MIB edged up by 0.10% to 34,327.95 points, despite a 4.66% fall in Telecom Italia shares amid sale pressures.
Lisbon’s PSI 20 index ascended by 0.43% to 6,178.82 points, capping off a broadly successful day across Europe.