Global Stocks Gain as Fed Signals Confidence in Economy

By Caitlin Ostroff 

Global stocks edged higher Thursday after the U.S. Federal Reserve signaled its confidence in the economy's growth prospects for the next year.

Futures linked to the Dow Jones Industrial Average ticked up 0.1%. European stocks gained slightly, with the Stoxx Europe 600 gauge rising 0.2%

The U.S. central bank's policy makers indicated that they believe interest rates are low enough to stimulate growth in the world's largest economy, and left monetary policy unchanged on Wednesday. The outlook is "a favorable one," Chairman Jerome Powell said. The Fed's recent market interventions to keep short-term rates stable are also working, he said.

Later in the day, investors will get a sense of the approach European Central Bank President Christine Lagarde is likely to take in her new role when she holds her first public briefing following a rate-setting meeting. The ECB is widely expected to keep interest rates at minus 0.5%.

Meanwhile, the U.K.'s FTSE 100 rose 0.4% as investors await the outcome of the general election.

Politicians in both the major political parties are signaling an end to years of constrained fiscal policy as the country prepares to exit from the European Union, and the vote results will play a crucial role in determining the course of Brexit. While a Conservative Party majority is seen as most likely, recent polls have shown that the lead for Prime Minister Boris Johnson and his group over the Labour Party has narrowed.

The pound, which has rallied against the dollar in the last two weeks to surpass $1.32, is trading on Thursday up 0.1%.

Write to Caitlin Ostroff at [e-mail]

(END) Dow Jones Newswires

December 12, 2019 05:24 ET (10:24 GMT)

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