Europe opens sharply after the Fed, the SNB surprises

by Augustin Turpin

(Reuters) – The main European stock markets opened sharply higher on Thursday, investors having been reassured by announcements from the American Federal Reserve (Fed) on the pace of future interest rate cuts.

The day will still be busy with monetary policy announcements as the Swiss National Bank (SNB) announced, to everyone’s surprise, a cut in its key rate, making it the first major central bank to relax its monetary policy.

Investors are also awaiting announcements at midday from the Bank of England for which a status quo on rates is expected.

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In Paris, the CAC 40 gained 0.47% to 8,199.41 points around 08:50 GMT. In London, the FTSE 100 gained 1.09% and in Frankfurt, the Dax advanced 0.75%.

The EuroStoxx 50 index is up 0.9%, the FTSEurofirst 300 is up 0.73% and the Stoxx 600 is up 0.76%.

Futures contracts on Wall Street predict an opening up 0.32% for the Dow Jones, 0.45% for the Standard & Poor’s-500 and 0.81% for the Nasdaq

The basic resources subindex led sectoral gains with a 2.8% jump, as prices of most metals rose after the Fed announcements, while gold hit a record high.

The morning is also marked by the publication of data from the S&P Global PMI indices for France, Germany, Great Britain and the euro zone.

In terms of values, Worldline gained 3.4% after announcing on Thursday the appointment of Wilfried Verstraete as a director with a view to his election as future chairman of the board of directors.

(Written by Augustin Turpin, edited by Blandine Hénault)