Europe open: Markets rise after Fed cuts rates, BoE statement eyed
European stocks were higher on Thursday morning, as investors digested the impact the Fed's latest rate cut and eyed the next Bank of England monetary policy statement.
At 0856 BST, the Stoxx 600 was up 0.4% at 390.78, as Germany's DAX climbed by 0.2% to 12,418.94 and the French CAC 40 rose by 0.4% to 5,643.60. Meanwhile, London's FTSE 100 was 0.2% higher at 7,331.33.
Stateside, the Federal Reserve announced its expected 25 basis point cut to its interest rate targets overnight, to between 1.75% and 2%, but signalled that further cuts were unlikely as the central bank's policymakers remained split when it comes to the next steps.
President Trump was unhappy with the cut, after having argued for a rate reduction to zero or below last week, turning to Twitter to rage that the Fed had "no ‘guts,’ no sense, no vision".
Craig Erlam, market analyst at Oanda, said the Fed was choosing to be reactive rather than proactive, which meant the central bank would focus on being committed to doing what's necessary, as opposed to actually guiding on rates.
"While investors may be frustrated about this, it's probably not the worst approach as we don't know how long the trade war will last, how much worse it will get and what the full consequences will be.
"That's a lot of unknowns and if it is resolved over the next couple of months, it would dramatically change the outlook and the path of interest rates."
Investor focus was shifting to the Bank of England's next monetary policy statement on Thursday, which was set to be released at midday in London and was expected to see interest rates held steady as the 31 October Brexit deadline looms.
Michael Hewson, market analyst at CMC Markets, said: "With 'no deal' a much higher probability now than it was at the last meeting, the main focus is likely to be on what measures the bank might look to take in the event of such an outcome."
Among individual stocks, London-listed IG Group led the Stoxx 600 higher as it reported flat first-quarter revenues but said it had performed well and backed its expectations for a return to revenue growth in the 2020 financial year.
Banks were broadly higher, with Bankia, Bank of Ireland Group, Commerzbank, Natixis, Caixabank and Banco de Sabadell all among the top risers.
UK retailer Next was the leading faller, dropping despite reporting 2.7% interim profit growth and strong online sales.
(Editing by Josh White)