European Stocks Rebound as Yellen Clarifies Fed Rate Policy

European stocks jumped from an eight-month low after Federal Reserve Chair Janet Yellen said she’s ready to raise rates this year, indicating recent market turmoil won’t derail the U.S. recovery.

Her comments helped clarify the Fed’s thinking, after the central bank’s decision to hold rates last week confused investors about the trajectory of U.S. rates and increased stock volatility. Following a selloff yesterday that wiped out its 2015 gains, the Stoxx Europe 600 Index closed 2.8 percent higher today.

All 19 industry groups rose at least 1 percent, and Germany’s DAX Index rebounded 2.8 percent from its lowest level since December. Italy’s FTSE MIB Index rallied the most among western-European markets, up 3.7 percent.

Europe’s benchmark gauge dropped 18 percent from a peak in April through yesterday, taking its valuation to 14.6 times estimated earnings, down from a multiple of 17.1 in July. Today’s biggest advance in a month helped the Stoxx 600 trim a second weekly decline. It’s down 1.6 percent for the period as carmakers tumbled after Volkswagen AG said it cheated on U.S. diesel-emission tests.

Volkswagen fell 3.8 percent, reversing an intraday advance of as much as 4.3 percent, after people familiar with the matter said executives in Germany controlled key aspects of the faked tests.

Source : Bloomberg

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European Stocks Rebound After Yellen Clarifies Fed Rate Policy

European stocks jumped the most in two weeks, rebounding from an eight-month low after Federal Reserve Chair Janet Yellen said she’s ready to raise rates this year.

Her comments helped clarify the Fed’s thinking, after the central bank’s decision to hold rates last week confused investors about the trajectory of U.S. rates and increased stock volatility. After a selloff yesterday wiped out all of its 2015 gains, the Stoxx Europe 600 Index added 2 percent at 8:13 a.m. in London. All 19 industry groups climbed.

Europe’s benchmark gauge dropped 18 percent from a peak in April through yesterday. Today’s advance is helping to trim the Stoxx 600’s second weekly decline. The gauge has fallen 4.3 percent as carmakers tumbled after Volkswagen AG admitted to cheating on U.S. pollution tests.

Automakers clawed back some of the losses today, among the best performers in industry groups as Volkswagen AG, BMW AG and Renault SA all rose more than 4 percent.

Miners, which also bore the brunt of this week’s selloff, rallied today. Glencore Plc gained 4.8 percent from a record low, paring its drop this year to 65 percent.

Among stocks moving on corporate news, Adidas AG gained 2.8 percent after peer Nike Inc. reported quarterly earnings that estimates. Sanofi added 2.1 percent as people familiar with the matter said the drugmaker may sell its bio-surgery and renal units.

Source: Bloomberg

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