European stock futures point to a sharply higher open Friday after the U.S. Federal Reserve said it would buy mortgage-backed securities to boost growth in the world's largest economy.
Asian markets are rallying across the board and commodities are extending their overnight gains after the Fed announced the continuation of its "Operation Twist" program, saying that 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.
As expected, the Fed extended its vow to keep interest rates at rock-bottom rates until at least mid-2015 and pledged to continue its purchases of mortgage-backed securities until the outlook for the labor market improves substantially.
The Fed's latest move came a week after the European Central Bank announced its most ambitious plan to buy government bonds from the region's struggling countries to help lower their borrowing costs.
Looking ahead, expectations remain fairly high that the Bank of Japan may soon expand its own bond purchase program when it holds its two-day policy meeting on 18th and 19th. Closer home, the results of a comprehensive audit of Spain's banking sector are expected in the next few days.
In corporate news, Drillisch AG said it was authorized to acquire treasury stock up to a total of 10 percent of the capital stock.
GERRY WEBER International AG reported group sales revenues for the first nine months of the financial year of 554.4 million euros, an increase of 13.9 percent from the previous year.
European stocks ended on a mixed note on Thursday as investors waited to see if the Federal Reserve would announce new measures to stimulate the economy at a monetary policy meeting. The Euro Stoxx 50 index of Eurozone bluechip stocks fell 0.8 percent, but the Stoxx Europe 50 index, which includes some major U.K. companies, edged up 0.1 percent.
Around Europe, France's CAC 40 fell 1.2 percent and the German DAX slid half a percent, while the U.K.'s FTSE 100 rose 0.7 percent and Switzerland's SMI added 0.4 percent.
U.S. stocks rose sharply overnight, as traders reacted positively to the Federal Reserve's highly-anticipated monetary policy announcement. The Fed announced a plan to increase policy accommodation by purchasing additionally agency mortgage-based securities at a pace of $40 billion per month. The Dow and the S&P 500 jumped about 1.6 percent each to reach their best closing levels in well over four years, while the tech-heavy Nasdaq rose 1.3 percent to a nearly 12-year closing high.
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