European shares advance as Fed begins easing cycle with jumbo rate cut By Reuters

(Reuters) – European stocks jumped nearly 1% on Thursday after the U.S. Federal Reserve delivered a 50-basis-point rate cut and flagged that further easing would be measured, raising hopes of a soft landing for the American economy.

The continent-wide index was up 0.9% at 519.15 points, as of 0712 GMT, with all sectors trading higher except telecom that slid 0.6%.

The U.S. central bank kicked off its monetary-easing cycle on Wednesday with a jumbo reduction that brought the benchmark policy rate to 4.75%-5.00% range.

Fed Chair Jerome Powell said this was meant to show policymakers’ commitment to sustaining a low unemployment rate now that inflation has eased.

Investors will now watch out for Bank of England’s rate decision at 1100 GMT, with Britain’s benchmark up 0.9% ahead of the verdict.

Among stocks, Next climbed 4.4% on Thursday as the British clothing retailer is on track to make an annual profit of almost 1 billion pounds ($1.3 billion) after it raised its outlook for the second time in two months.

British online grocer Ocado (LON:) Group soared 12.6% after Ocado Retail lifted its forecast for 2023-2024 following a 15.5% jump in its revenue.

Shares of IG Group slipped 2.7% as the company was trading without entitlement to its latest dividend pay-out.