Europe midday: Stocks push higher as investors welcome dovish Fed; Glencore rallies

European stocks rose, led higher by strength in the mining sector as investors welcomed dovish signals from the Federal Reserve.

At midday, the benchmark Stoxx Europe 600 index was up 0.7%, France’s CAC 40 was 0.9% higher and Germany’s DAX was up 1%.

Basic resources were the standout gainers, with the Stoxx Europe 600 index for the sector up 4.2% as metals prices advanced across the board.

Minutes released on Thursday from the latest Federal Open Market Committee meeting showed the Fed almost hiked interest rates but refrained as a result of the slowdown in China and its potential impact on the US.

According to the minutes, policymakers thought it was more prudent to wait for evidence that the economy had not deteriorated and that inflation would gradually move back toward towards the 2% annual target.

“Risk assets are being buoyed further by hungry investors happy to get back into equities as the outlook for monetary policy tightening looks more assured with rates set to stay lower for longer,” said Angus Campbell, senior analyst at FxPro.

“The FOMC minutes were decidedly dovish with the Fed continuing to stress its concern in respect to risks from overseas and the impact this is having on global growth and US domestic inflation.”

Commodities trader Glencore rallied as investors cheered news that it will cut 500,000 tonnes or around a third of its annual zinc production as it looks to combat declining prices. The company said the changes would reduce fourth-quarter 2015 mine production by around 100,000 of contained zinc metal.

Lloyds Banking Group was on the front foot after the UK government cut its stake in the bank by a further 1% to just under 11%. Earlier this week, it emerged that the finance ministry will sell at least £2bn worth of Lloyds share to private retail investors in spring of next year as it looks to return the bank to private ownership.

Standard Chartered rose sharply following a report that the bank’s new chief executive Bill Winters is planning to cut up to a quarter of its most senior staff in a bid to reduce costs.

Elsewhere, Givaudan gained after the Swiss fragrance maker maintained its mid-term financial targets as it posted a big jump in third-quarter underlying sales.

Steelmaker ArcelorMittal was boosted after JPMorgan Cazenove raised its stance on the stock to ‘overweight’ from ‘neutral’.

The economic calendar is pretty light, but US wholesale inventories are due at 1500 BST.