Europe midday: Shares make strong gains after earnings dump

(Sharecast News) - European stock made strong gains Thursday as investors digested the latest rate hike from the US Federal Reserve, another corporate earnings dump and looked ahead to a policy decision from the European Central Bank. The Stoxx 600 was up by 0.93% with all major regional bourses higher. As expected, the Fed lifted rates by 25 basis points to a target range of 5.25%-5.5% - the highest level in 22 years. Chairman Jerome Powell said inflation has moderated somewhat since the middle of last year, but hitting the Fed's 2% target "has a long way to go".

"I would say it's certainly possible that we will raise funds again at the September meeting if the data warranted," Powell said. "And I would also say it's possible that we would choose to hold steady and we're going to be making careful assessments, as I said, meeting by meeting."

The ECB is also expected to increase rates to 3.75% from 3.5%.

In economic news, German consumer sentiment is expected to stabilise in August amid hopes of a decline in inflation, according to a survey released on Thursday by market research group GfK.

GfK's forward-looking consumer sentiment index for next month rose to -24.4 from a revised -25.2 in July. This was ahead of expectations for a reading of -24.7.

In equity news, shares in UK asset manager St James's Place slumped as it reported a fall in profits.

Barclays stock was lower as interim profits missed expectations and it expected lower net interest margins for the full year.

Centrica and UK car dealer Inchcape both made strong gains after results.

Reporting by Frank Prenesti for Sharecast.com