The European stock market looks healthier than expected after a significant interest rate hike by the European Central Bank (ECB) in an effort to fight inflation.
The STOXX Europe 600 is up 1.31% at 419.53. Market growth was broad-based with the stock market index, the CAC 40 up 1.35% to 6,208.70. The German DAX PERFORMANCE-INDEX index also led the gains with a 1.53% rise to 13,102.31.
Among the market’s top growth trends, food and beverages held steady, basic resources rose 3.3% and banks rose 1.6%.
The European Central Bank renewed its commitment to fighting inflation and raised interest rates by 75 basis points. The central bank shared its inflation forecast for the year, which is estimated at 8.1 percent. The fight against inflation is expected to continue until it is no longer significant.
The British market is doing surprisingly well after the death of Queen Elizabeth II at the age of 96. Her Majesty, the Queen, ruled for over 70 years and her reign maintained the legacy of the British Empire as one of the most successful in history.
“Queen Elizabeth II was the rock on which modern Britain was built. Our country grew and flourished under her reign” said the new British Prime Minister, Lizz Truss, in a statement. “Britain is the great country it is today because of her. She came to the throne right after World War II. She championed the development of the Commonwealth – from a small group of seven countries to a family of 56 nations covering every continent in the world. Today we are a modern, prosperous and dynamic nation“.
With the Queen’s eldest son, Prince Charles, set to be crowned as the next monarch, the market maintained a healthy outlook with the FTSE 100 Index up 1.52% to 7,372.33.
The stock market across the Atlantic
The U.S. stock market has also shown signs of health despite the aggressive fight against inflation by the U.S. Federal Reserve.
Fed Chairman Jerome Powell’s commitment is to fight inflation so that the job gets done. The inflation target in the U.S. remains at 2-4%, a target that, if achieved, will mark a very large step up from the current 8.5% it is.
“History strongly warns against a premature relaxation of policy“, Jerome Powell told the Cato Institute, a libertarian think tank based in Washington, D.C. “I can assure you that my colleagues and I are strongly committed to this project and will continue until the job is done.”
The S&P 500 was up 0.66 percent at 4,006.18. The Dow Jones and Nasdaq Composite also closed Thursday’s session up 0.61% and 0.60% respectively.