Europe close: Stocks bounce back despite losses for Basic Resources and Oil&Gas shares

Stocks across the Continent finished near their best levels of the session on Thursday, despite the drag from miners and Big Oil as strength in the US dollar weighed on commodity prices after the US central bank opted to push back on expectations for a long series of interest rate cuts extending into 2020.

To take note of, while the Fed did push back on rate cut expectations, it did leave the door open to further easing if needed and there was also positive news to be had on the US-China trade front.

"European markets are closing out another day in the red, with yesterday’s underwhelming FOMC announcement providing markets with a somewhat disappointed mindset," said IG's Josh Mahony.

Against that backdrop, by the end of trading, the benchmark Stoxx 600 had added 0.50% to 387.68, alongside a rise of 0.53% to 12,253.15 for the German Dax while the FTSE Mibtel climbed 0.79% to 21,556.91.

Meanwhile, on the heels of the Federal Reserve's decision overnight, euro/dollar was down by 0.09% to 1.1066 - albeit off its worst levels - and front month Brent crude oil finished 2.78% lower at $63.29 a barrel on the ICE.

In parallel, the Stoxx 600's gauge of companies in the Basic Resources space cratered 3.02% and that for Oil&Gas was down by 1.46%.

Stocks thus managed to shake off the impact of Wednesday evening's losses on Wall Street, helped by apparently positive news on the US-China trade front.

Earlier, China's Ministry of Commerce said that trade teams from Washington and Beijing would hold intensive talks throughout August in order to lay the groundwork for talks in September.

To a degree, that echoed a statement issued overnight by the White House describing talks during the current week on "forced technology transfer, intellectual-property rights, services, non-tariff barriers, and agriculture" as "constructive".

To take note of, according to reports Italian Co-Deputy Prime Minister, Matteo Salvini, was refusing to back the government's budget proposal unless they included "big" tax cuts.

There was also some good macroeconomic data on Thursday however - or at any rate better than expected.

IHS Markit's final reading on its euro area manufacturing sector Purchasing Managers' Index for July was revised higher from a reading of 46.4 to 46.5, thanks to stronger than anticipated readings out of Germany, Italy and Spain that more than offset downwards revisions to the French PMI.

And overnight, Caixin's China factory PMI surprised to the upside, recovering from 49.4 to 49.9 (consensus: 49.6).

On the corporate front, shares of online fashion retailer Zalando rocketed to a fresh record high after posting better than expected second quarter operating profits and reporting a 15% jump in active customers to 28.3m while visits to its website soared by almost a third to nearly reach 1.0bn.