European Stocks Close Broadly Higher As Fed Rate Cut Lifts Sentiment

European stocks closed higher on Thursday with some of the markets rising to multi-week highs, as the rate cut move by the Federal Reserve outweighed concerns about valuations of AI-related stocks.

Some positive corporate news helped underpin sentiment, but Oracle’s lower than expected quarterly revenue and lower than expected forecasts weighed on tech stocks.

The Fed lowered interest rate by 25 basis points, as widely expected, on Wednesday.

At a news conference following the decision, Fed Chair Jerome Powell said the Fed would have to “wait and see” before making its next move, adding a rate hike isn’t in the base case.

Fed members suggested just one further cut in their 2026 central projection, but traders bet risks are skewed towards more cuts.

Meanwhile, the Swiss National Bank decided today to keep its key interest rate at 0%. SNB’s decision comes against the backdrop of 0% inflation in Switzerland in November, which is at the lower end of the central bank’s target range of 0-2%.

The pan European Stoxx 600 climbed 0.55%. The U.K.’s FTSE 100 gained 0.49%, Germany’s DAX closed higher by 0.68% and France’s CAC 40 settled with a gain of 0.79%, while Switzerland’s SMI ended down by 0.13%.

Among other markets in Europe, Belgium, Denmark, Finland, Greece, Ireland, Netherlands, Norway, Poland, Russia, Spain, Sweden and Turkiye closed higher.

Iceland and Portugal ended weak, while Czech Republic settled flat.

In the UK market, The Magnum Cream Company shares surged 5.7%, extending recent upmove. Metlen Energy & Metals climbed 5.35%, and Ashtead Group rallied 4.7%.

JD Sports Fashion, Endeavour Mining, IAG, WPP, Fresenillo, Whitbread, Intercontinental Hotels Group, Diageo, Berkeley Group Holdings, Beazley, DCC, Croda International, Sainsbury (J) and Pearson gained 1.8 to 4%.

Informa, Smith & Nephew, Entain, Associated British Foods and Centrica lost 1 to 3.3%.

In the German market, Daimler Truck Holding, Brenntag, Heidelberg Materials, BASF, Siemens, Deutsche Post, Merck, Continental and Munich RE gained 2 to 4.5%.

E.ON drifted down 3.1%, and Deutsche Boerse lost about 2.1%. Qiagen and MTU Aero Engines also declined sharply.

In the French market, TP, Saint Gobain, Capgemini, Carrefour, Pernod Ricard, Vinci, BNP Paribas and Edenred gained 2 to 5%.

Schneider Electric climbed 2.7%, attracting attention after the the company said it plans a share buyback program of €2.5 billion-€3.5 billion and intends to pursue a divestment program of €1.0 billion- €1.5 billion in revenues, with both initiatives to be completed by 2030.

Legrand, Stellantis, STMicroElectronics and Safran ended notably lower.