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stocks, news, Bank of England rate decision

Commuters crossing a junction near the Bank of England (BOE), left, in the City of London, UK, on Wednesday, May 8, 2024. Bank of England policymakers appear the most divided since they brought their hiking cycle to a close last year, illustrating the challenge that Governor Andrew Bailey faces in steering his colleagues toward possible interest-rate cuts in the coming weeks. Photographer: Hollie Adams/Bloomberg via Getty Images

Bloomberg | Bloomberg | Getty Images

LONDON — European stocks closed higher on Thursday afternoon as investors reacted to policy rate decisions from three central banks.

The pan-European Stoxx 600 provisionally made a 0.88% gain, with all sectors and major bourses in positive territory. Tech stocks led, up over 1.63%.

The Bank of England on Thursday kept interest rates unchanged at a 16-year high of 5.25%, a move that had been widely expected. A majority of economists polled by Reuters had forecast a cut in August after the country’s July 4 election.

The decision comes after data released Wednesday showed that U.K. inflation rose by an annual 2.0% in May, hitting the central bank’s inflation target.

Earlier, the Swiss National Bank said it is lowering its policy rate by 0.25 percentage points to 1.25%, a move that was anticipated by two-thirds of economists polled by Reuters. The decision follows a similar move in March and means the SNB retains its position as a front-runner in the global policy easing cycle.

Norway’s central bank held its policy interest rate at 4.5% on Thursday, as expected, and said the rate would continue to be kept at a 16-year high till the end of 2024, providing the economy evolves as currently envisaged.

Investors will be keeping an eye out on earnings from Boohoo Group and DS Smith.

Shares of Germany-based drug discovery and development company Evotec rose more than 15% on Thursday after Bloomberg reported that buyout firms have been studying the company.

Britain’s Tate & Lyle tumbled toward the bottom of the European benchmark. Shares of the specialty food and beverage company fell nearly 11% after it announced it had entered into an agreement to buy U.S.-based CP Kelco for $1.8 billion.

Overnight, Asia-Pacific markets were mostly lower on Thursday as China kept its one- and five-year loan prime rates unchanged.

Stateside, the S&P 500 climbed in morning trade as it broke above 5,500 for the first time.

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