Holly Ellyatt, Matt Clinch, Katy Barnato
European stocks leaped to close higher on Thursday as global investors reacted to the U.S. Federal Reserve's decision to hold interest rates steady and oil prices gained.
The pan-European Euro Stoxx 600 Index was higher with all sectors in positive territory and all major bourses posting gains. European markets followed the positive lead set in Asia and the U.S. where stocks rallied after the Federal Reserve kept interest rates unchanged on Wednesday, despite hinting of a hike later in the year.
The U.K.'s FTSE 100 traded 1.2 percent higher. The French CAC was up 1.9 percent and the German DAX was nearly 2 percent higher on the day.
In its post-meeting statement, the Federal Open Market Committee expressed confidence in economic growth, but not enough to make a move this month. "The committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives," the Fed's policymaking committee said in a statement.
A weaker dollar after the policy decision helped the prices of metals, basic resources and all sorts of commodities, which in turn spurred buying in equities with exposure to these sectors.
The morning after the Fed decision, Wall Street opened higher with both the Dow Jones Industrial Average and the broader S&P500 up 0.6 percent.
Miners rise; Maersk up 1.7%Basic resources was the top-performing stock sector in Europe on Thursday. Strong performers included BHP Billiton, Glencore and Amec Foster and ArcelorMittal, which all traded over 4 percent higher on the day.
Meanwhile, shipping giant Moller-Maersk saw shares close over 3 percent higher after it announced extensive reorganization plans.
Banking stocks were also in favor, following on from a major policy overhaul by the Bank of Japan this week.