The pan-European Stoxx 600 jumped 0.7% after the opening bell, basic resources and oil and gas stocks both rising more than 1.5% in early deals as all sectors traded in positive territory.
The week’s focus on central banks continues Thursday, with the Bank of England due to announce its June policy decision at noon BST. Economists polled by Reuters are expecting a unanimous vote to hold rates at 0.75%, despite two officials recently mooting the need for higher borrowing costs in the near future.
· Asian stock markets rallied on Thursday while the dollar dropped and global bond yields plunged, with the 10-year U.S. yield falling below two percent, after the Federal Reserve signaled possible interest rate cuts later this year.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.92%, led by gains in China, while Tokyo’s Nikkei advanced 0.67%.
Signs that China and the United States are returning to the negotiating table after a six-week hiatus also bolstered risk sentiment.
The Bank of Japan kept monetary policy steady on Thursday, preferring to save its dwindling ammunition, but speculation is rising it may further loosen its ultra-easy stance later this year.
· Japan’s Nikkei ended at a fresh six-week high on Thursday after the U.S. Federal Reserve signalled it was ready to cut interest rates to support the economy, but gains were capped by a stronger yen.
The Nikkei share average rose 0.6% to 21,462.86 points, extending gains from a 1.7% rise on Wednesday.
· China stocks extended their rally on Thursday to end at an eight-week high as investors hoped for signs of thaw in Sino-U.S. trade dispute and policy easing after the Federal Reserve signalled possible interest rate cuts later this year.
Expectations of a worldwide wave of central banks’ stimulus also helped bolster sentiment after the U.S. Fed signalled more policy stimulus is needed to boost growth.
The blue-chip CSI300 index ended up 3% at 3,828.52 points, while the Shanghai Composite Index closed 2.4% firmer at 2,987.12 points. Both indexes closed at their highest level since April 30.
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