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European Stocks Rally After Weak Start, End On Firm Note

Despite data showing a big jump in U.S. jobless claims last week, European stocks rallied after early weakness on Thursday as investors continued to make purchases following the U.S. Senate passing the massive $2 trillion stimulus package.

The bill now heads to the Democrat-controlled House, which will be under pressure to quickly send the legislation to President Donald Trump's desk.

The sharp rise in unemployment claims has triggered hopes the U.S. government will initiate further stimulus to bring the economy back on track.

The pan European Stoxx 600 gained 2.55%. The U.K.'s FTSE 100 ended up 2.24%, Germany's DAX advanced 1.28% and France's CAC 40 surged up 2.51%, while Switzerland's SMI closed higher by 2.39%.

Austria, Belgium, Denmark, Finland, Greece, Iceland, Netherlands, Norway, Poland, Portugal, Russia, Spain, Sweden and Turkey closed sharply higher.

Italy ended modestly higher, while Czech Republic ended weak.

Bank of England's policymakers today unanimously decided to hold the interest rate at a record low and asset purchase programme and signaled further easing if required.

The bank also noted risk of longer-term damage to the economy from the coronavirus, or covid-19 outbreak.

At the regular policy meeting, the Monetary Policy Committee governed by Andrew Bailey decided to maintain the interest rate at 0.1% and the quantitative easing at GBP 645 billion.

The bank had altogether reduced the rate by 65 basis points at two unscheduled meetings this month. At a special meeting on March 19, the bank had cut its bank rate by 15 basis points and expanded bond purchases by GBP 200 billion.

The MPC said it can expand asset purchases further if needed. The committee said it stands ready to respond further as necessary to guard against an unwarranted tightening in financial conditions, and support the economy.

In other economic news from Europe, French manufacturing confidence decreased in March, survey results from the statistical office Insee showed Thursday.

The manufacturing sentiment index fell to 98 in March from 101 in February. Economists had forecast a score of 93. This was below the long-run average of 100.

German consumer confidence is set to decline sharply to the lowest in more than a decade in April as the increase in the number of coronavirus infection cases and the accompanying measures made consumers to take cautious approach, survey data from market research group GfK showed Thursday.

The forward-looking consumer confidence index fell to 2.7 from 8.3 in March. The score was forecast to fall moderately to 7.7 from March's initially estimated value of 9.8.

At 2.7 points, the score reached its lowest level since May 2009. During the financial and economic crisis, the consumer climate index was at 2.6 points.

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