The European markets are sharply higher in afternoon trading Friday, boosted by the Federal Reserve's announcement of open-ended monetary easing. Miners and banks are seeing strong upward move. The Asian markets gained and the U.S. index futures are higher.
The Fed, at the end of a two-day policy meeting, announced a plan to increase policy accommodation by purchasing additional agency mortgage-backed securities at a pace of $40 billion per month. The Fed also said it would continue its purchases of mortgage-backed securities until the outlook for the labor market improves substantially.
The 'Operation Twist' program also will be continued. Thus, the actions taken together will increase the central bank's holdings of longer-term securities by about $85 billion each month through the end of the year.
On the economic front, Eurostat said Eurozone inflation increased as initially estimated to 2.6 percent in August. Also, the number of persons employed remained stable in the euro area during the second quarter.
The Euro Stoxx 50 index of eurozone bluechip stocks is climbing 2.02 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is falling 0.97 percent.
The German DAX is climbing 1.56 percent and the French CAC 40 is gaining 2.04 percent. The UK's FTSE 100 is rising 1.65 percent while Switzerland's SMI is advancing moderately by 0.79 percent.
In Frankfurt, Volkswagen is surging 4.1 percent. BMW and Daimler are gaining 3 percent and 2.7 percent, respectively.
ThyssenKrupp is climbing 3.5 percent. Outside the main index, Salzgitter is surging 4.9 percent.
Commerzbank is gathering 2.3 percent and Deutsche Bank is advancing 1.5 percent. UBS cut Deutsche Bank to "Neutral" from "Buy."
Commerzbank cut Fraport to "Hold" from "Buy." The stock is up modestly.
Those making notable losses include Fresenius, Fresenius Medical Care, Beiersdorf, Merck and Henkel.
Berenberg lowered its rating on E.ON. The stock is down 0.5 percent. Peer RWE is falling 0.7 percent after a price target reduction.
Fashion and lifestyle firm Gerry Weber International reported a 22 percent increase in third-quarter profit, but margin declined from last year. The stock is moderately lower.
In Paris, Steel giant ArcelorMittal is surging 6.7 percent. Carmakers Peugeot and Renault are gaining 5.2 percent and 5 percent, respectively.
Among lenders, BNP Paribas is advancing 4 percent. Societe Generale is gaining 3.6 percent and Credit Agricole is rising 3.3 percent.
Saint-Gobain is adding 5.1 percent, Bouygues is rising 3.5 percent and Vinci is climbing 3.1 percent.
In London, Anglo American is adding 6.3 percent and Antofagasta is jumping 8.3 percent. BHP Billiton is gaining 4.3 percent and Rio Tinto is jumping 6.1 percent.
Eurasian Natural Resources is climbing 9.2 percent, Vedanta is gaining 11.8 percent and Kazakhmys is advancing around 11 percent.
Russian steel maker Evraz is surging 11.8 percent. Gold miner Petropavlovsk is surging over 12 percent.
Royal Bank of Scotland Group said it plans to launch an initial public offering of its fully-owned subsidiary Direct Line Insurance Group Plc in an all-secondary offering by the lender. The stock is gaining 3.4 percent.
Barclays is advancing 3.8 percent and Lloyds Banking is gathering 3.5 percent.
JD Wetherspoon is climbing 4.3 percent after announcing full year results.
Chemring Group is gaining 7.2 percent. The company announced extension of deadline by the Takeover Panel for Carlyle Group to make an offer for the firm.
ABB is gaining 3.4 percent in Stockholm. Exane BNP raised its rating on the stock.
Unicredit is up 3.3 percent in Milan. HSBC cut its rating on the stock.
Across Asia/Pacific, Australia's All Ordinaries climbed 1.2 percent, Hong Kong's Hang Seng rallied 2.9 percent and Japan's Nikkei 225 gained 1.8 percent. China's Shanghai Composite Index ended moderately higher by advancing 0.6 percent.
In the U.S., futures point to a higher open on Wall Street. In the previous session, stocks moved substantially higher in the afternoon amid a positive reaction to the Federal Reserve's highly anticipated monetary policy announcement. The Dow jumped 1.6 percent, the Nasdaq surged up 1.3 percent and the S&P 500 soared 1.6 percent.
In the commodity space, crude for October delivery is adding $1.76 to $100.07 per barrel and December gold is rising $4.8 to $1776.9 a troy ounce.
by RTT Staff Writer
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