The European markets rose for the second day on Thursday, as banking stocks rallied after U.S. lender Wells Fargo forecast record first quarter earnings and mining stocks gained after copper prices advanced for a third day.
The Bank of England today maintained its key interest rate at record low of 0.5%. The interest rate now stands at the lowest level since the central bank was established in 1694. The BoE maintained the rate after slashing it for six straight months from 5% in September.
The U.S. Labor Department said in its report that jobless claims fell to 654,000 from the previous week's revised figure of 674,000. Economists had expected jobless claims to edge down to 660,000 from the 669,000 originally reported for the previous week.
Crude for May delivery rose $1.49 to $50.87 a barrel on the New York Mercantile Exchange, taking cue from on a rising stock market and surprising news from retailers that suggests Americans are spending money.
The FTSEurofirst 300 index of pan-European blue chips closed 2.07% higher at 778.39 points, while the narrower DJ Stoxx 50 index rose 2.19% to 1,917.77 points.
Around Europe, the U.K.'s FTSE 100 index rose 1.48% to 3,983.71, while France's CAC 40 index surged up 1.82% to 2,974.18 and Germany's DAX index climbed 3.06% to 4,491.12.
Banking stocks gained after Wells Fargo, the fourth biggest U.S. bank, forecast first quarter net income of about $3 billion or $0.55 per share. HSBC, Europe's largest bank, climbed 8.5%, while Deutsche Bank, Germany's biggest lender, surged up 10.1% and UBS, Switzerland's largest bank, rose 4.6%. Lloyds Banking Group, Britain's biggest mortgage lender, gained 10.9%.
Barclays, Britain's third largest bank, rallied 12.5% after the company said it was selling its iShares asset management business to private equity firm CVC Capital Partners for £3 billion pounds in a deal that will be 70% funded by the British bank.
Hypo Real Estate jumped 15% after the German government offered to take over the ailing property lender.
ING Group soared 17.8% after the Dutch financial services group said it planned to divest operations worth up to ?8 billion to reduce risk and will focus its banking activities on Europe.
Mining stocks advanced after copper prices rose for a third day on the London Metal Exchange. BHP Billiton, the world's biggest miner, rose 3.8%, while Anglo American, the second biggest, climbed 6.8% and Rio Tinto, the third biggest, surged up 5.3%. Copper miner Antofagasta gained 5.5%.
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