Investing.com - European stocks opened sharply higher on Wednesday, after Federal Reserve Chair Janet Yellen dampened expectations for a U.S. rate hike in the near future.
During European morning trade, the EURO STOXX 50 rallied 1.35%, France’s CAC 40 advanced 1.45%, while Germany’s DAX 30 jumped 1.36%.
Global equities strengthened after Fed Chair Janet Yellen stressed the need to be cautious in raising interest rates.
Yellen added that, according to research, with a funds rate at zero and increased uncertainty, the best monetary policy is greater gradualism. However, the Fed can hike rates if the economy grows faster, she said.
Yellen was speaking at a conference in New York late Tuesday.
Financial stocks were broadly higher, as French lenders BNP Paribas (PA:BNPP) and Societe Generale (PA:SOGN) surged 2.10% and 2.52%, while Germany’s Commerzbank (DE:CBKG) and Deutsche Bank (DE:DBKGn) gained 0.72% and 1.77%.
Among peripheral lenders, Italy’s Unicredit (MI:CRDI) and Intesa Sanpaolo (MI:ISP) rose 0.24% and 0.82% respectively, while Spanish banks BBVA (MC:BBVA) and Banco Santander (MC:SAN) rallied 1.80% and 1.92%.
Elsewhere, Volkswagen (DE:VOWG_p) climbed 0.88% followinf reports that the company’s 'clean diesel' advertising campaign could expose it to up to $15 billion in fines after the U.S. Federal Trade Commission launched a new lawsuit on Tuesday.
In London, commodity-heavy FTSE 100 jumped 1.28%, led by sharp gains in the mining sector.
Shares in Glencore (LON:GLEN) rallied 5.11% and Rio Tinto (LON:RIO) climbed 5.38%, while Bhp Billiton (LON:BLT) advanced 5.63% and Anglo American (LON:AAL) surged 7.26%.
Financial stocks were also on the upside, as Barclays (LON:BARC) and Lloyds Banking (LON:LLOY) gained 0.68% and 0.76% respectively, while HSBC Holdings (LON:HSBA) advanced 1.39% and the Royal Bank of Scotland (LON:RBS) rallied 1.72%.
On the downside, Marks and Spencer Group PLC (LON:MKS) saw shares tumble 1.26% after analysts at Jefferies & Co set a hold rating on the stock.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.48% gain, S&P 500 futures a 0.46% increase, while the Nasdaq 100 futures indicated a 0.54% climb.