- Yellen delivers first testimony
- UK retail sales rise
- Greek borrowing costs fall
FTSE 100: 1.23%
CAC 40: 1.09%
FTSE MIB: 1.04%
Stoxx 600: 1.30%
European stocks gained after Federal Reserve Chair Janet Yellen indicated the US central bank will continue to scale back monetary stimulus.
In her first congressional testimony since taking over the reins from Ben Bernanke earlier this month, Yellen signalled that the recent drop off in the pace of employment growth and the turmoil in emerging markets will not stop the Fed from gradually tapering.
The central bank last month decided to reduce monthly bond purchases by $10bn to $65bn, its second round of cuts.
While Yellen noted that the labour market recovery has far to go, she said the Federal Open Market Committee is likely to reduce the pace of asset purchases further at future meetings.
She also addressed the recent upset in emerging markets but believes it does not pose a substantial risk to the US economic outlook.
"We will, of course, continue to monitor the situation."
Capital Economics said: "Overall, we expect the FOMC under her leadership to continue to reduce the asset purchases by $10bn at each meeting this year. The first hike in the Fed funds rate won't occur until mid-2015".
UK retail sales increase
UK like-for-like retail sales rose by 3.9% in January compared with the year before, according to the British Retail Consortium/KPMG sales monitor. This was much higher than the 0.4% growth registered in December and the 0.8% increase expected by analysts.
Greek borrowing costs fell to the lowest since 2010 as a rise of confidence in the euro-area's recovery boosted the region's bonds and stocks.
Portugal's five-year notes edged higher as the nation raised funding from debt markets for a second straight month. The nation is reportedly selling €3bn of debt maturing in 2024 via banks, its second bond sale this year as the end of its international bailout programme nears.
Interbank lending rates in China eased overnight following the week-long Lunar New Year holiday, while the People's Bank of China reportedly refrained from conducting reverse-repurchase operations.
Prices for single-family US homes rose in 73% of US cities in the fourth quarter, compared to 88% in the third quarter, as rising values in the past two years started to reduce affordability, the National Association of Realtors revealed today.
Michelin, Peugeot Citroen
Michelin & Cie. was up after Europe's largest tyre maker reported a fall in 2013 operating profit that missed analysts' estimates.
PSA Peugeot Citroen rallied after Goldman Sachs added the company to its 'conviction buy' list.
Barclays tumbled after reporting a 32% fall in adjusted annual pre-tax profit, reflecting restricting costs and a drop in income at the Investment Bank.
L'Oreal slipped, after rising earlier, following news the beauty products firm will pay €3.4bn in cash for 27.3m shares
held by Nestlé.
Hexagon jumped as the maker of measuring instruments reported fourth quarter income that exceeded forecasts.
Alcatel-Lucent dropped after Morgan Stanley cut its rating on the French network supplier to 'equal weight' from 'overweight'.
ICAP gained as Goldman Sachs raised its recommendation on the world's largest broker of transactions between banks to 'neutral' from 'sell'.
The euro advanced 0.12% to $1.3662.
Brent crude futures rose $0.266 to $108.920 per barrel, according to the ICE.