European stocks extended gains at on Thursday after the Bank of England raised interest rates to their highest level since 2009 and the US Federal Reserve also imposed a hike, but ruled out more aggressive moves in the future.
The pan-European STOXX 600 index rose 1.27%, with investor sentiment also helped by another dump of corporate earnings and updates.
In London, the Bank of England lifted its key base rate by 0.25 percentage points increase to 1%, as it looked to stem soaring inflation. It was the fourth consecutive rate rise from the Bank’s monetary policy committee (MPC), and takes borrowing costs to a level not seen since February 2009.
UK inflation hit 7% in March, the highest level since 1992 and more than triple the Bank’s official 2% target, as Russia’s war on Ukraine forced up oil and gas prices.
In the US, Wall Street closed higher after the Fed raised interest rates by 50 basis points, but the central bank’s Chairman Jerome Powell scotched suggestions of a 75 basis point hike in a coming meeting.
In equity news, shares in digital advertising firm S4Capital rose 17% as the company said it would publish delayed results on Friday.
Airbus shares rose after the aircraft maker reported higher-than-expected first-quarter profit and firmed up record plans for a 50% hike in narrow-body jet output.
Oil giant Shell gained after reporting a record first-quarter profit of $9.13bn, boosted by higher oil and gas prices which have been inflated due to the Ukraine war. The company also pledged more returns to shareholders.
BMW was higher as it posted a rise in quarterly profit, lifted by a re-evaluation of its Chinese joint venture stake and strong pricing.
Shares in Hikma Pharmaceuticals fell as the company cut annual sales and margin forecasts for its second-biggest unit, due to possible delays in the launch of a generic version of a sleep disorder treatment.
