Europe open: Stocks rise as investors welcome dovish signals from the Fed

At 0900 BST, 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%.

Minutes released on Thursday from the latest Federal Open Market Committee meeting showed the Fed almost hiked interest rated 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.

“On balance, while recent data suggest that US GDP growth and employment growth are being dragged down by the deteriorating global economic environment, there might be just enough momentum in the US economy to push the various labor market slack measures down to the Fed’s desired levels, supporting the Committee’s confidence in the inflation outlook,” said Philip Marey, senior US strategist at Rabobank.

“With two more employment reports to go before the December meeting, a hike before the end of the year still cannot be ruled out, although the risks of a delay into 2016 have increased considerably in recent weeks,” he added.

Commodities trader Glencore rallied as investors welcomed 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 in focus 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.

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