Investing.com - European stocks rallied on Thursday, as market volatility caused by the two consecutive devaluations of the yuan in China began to ease and focused returned to Greek bailout negotiations.
During European morning trade, the EURO STOXX 50 surged 1.64%, France’s CAC 40 advanced 1.78%, while Germany’s DAX 30 jumped 1.43%.
European equities were hit after the People's Bank of China devalued the yuan for a second consecutive day on Wednesday.
China devalued its currency by 2% in a surprise move on Tuesday to make its exports more competitive and shore up growth in the flagging economy.
The PBOC has described the move as a “one-off depreciation”, based on a new way of managing the exchange rate that better reflected market forces.
Meanwhile, investors continued to monitor developments on Greece's third bailout, which now must be approved by euro zone governments.
On Wednesday, Germany's Finance Ministry reportedly criticized a draft agreement between Greece and lenders as having "no full clarity on the direction of policies."
Financial stocks were broadly higher, as French lenders BNP Paribas (PARIS:BNPP) and Societe Generale (PARIS:SOGN) jumped 1.71% and 1.73%, while Germany's Deutsche Bank (XETRA:DBKGn) and Commerzbank (XETRA:CBKG) gained 0.53% and 0.06%.
Among peripheral lenders, Italy's Unicredit (MILAN:CRDI) and Intesa Sanpaolo (MILAN:ISP) rallied 1.51% and 1.70% respectively, while Spanish banks BBVA (MADRID:BBVA) and Banco Santander (MADRID:SAN) climbed 0.90% and 0.87%.
Elsewhere, German steelmaker Thyssenkrupp AG O.N. (XETRA:TKAG) surged 2.88% after reporting an increase in third quarter operating profit.
On the downside, German utility company RWE AG ST O.N. (XETRA:RWEG) saw shares tumble 1.07% after it reported a lower operating profit for the first half of the year.
In London, FTSE 100 advanced 0.79%, as U.K. lenders tracked their European counterparts higher.
Shares in HSBC Holdings (LONDON:HSBA) gained 0.41% and Lloyds Banking (LONDON:LLOY) climbed 0.58%, while the Royal Bank of Scotland (LONDON:RBS) and Barclays (LONDON:BARC) rallied 1.33% and 1.97% respectively.
Coca Cola HBC AG (LONDON:CCH) led gains on the index, with shares soaring 6.73% after the bottler reported a rise in profit in the first half of its financial year.
In the mining sector, stocks were mixed. Glencore (LONDON:GLEN) and Bhp Billiton (LONDON:BLT) jumped 1.57% and 1.66% respectively, while Randgold (LONDON:RRS) Resouces lost 1.45% and Rio Tinto (LONDON:RIO) plummeted 2.09%.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.31% rise, S&P 500 futures signaled a 0.31% gain, while the Nasdaq 100 futures indicated a 0.46% increase.