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German DAX opens higher 2.56 pct as China calms, US data ahead

Stocks in Europe opened in the green zone on Thursday as traders digested the recent policy action in China that helped to calm markets, while the Wednesday rally on Wall Street also boost the sentiment.

Germany's DAX 30 index opened 2.56% higher at 10,253.80, while the UK FTSE 100 index advanced 2.36% to 6,120.50.

Among the other indices, the French CAC 40 index gained 2.43% to 4,610.70, while the pan-European Euro Stoxx 50 index increased 2.57% to 3,249.50.

Stocks in Asia moved higher on Thursday, with the closely-watched Shanghai Composite index jumping about 3% after a huge sell-off recently, boosted by the latest steps from the Chinese central bank.

European stock investors are following the positive sentiment on Wall Street as major US indices closed Wednesday's session with about a 4% jump, boosted by New York Federal Reserve President William Dudley who said that a September rate hike seems less compelling than it was a few weeks ago.

On Wednesday, the People's Bank of China said it will inject 140 billion Yuan into the financial system through a short-term liquidity adjustment operation, a day after it cut the Reserve Requirement Ratio by 50 basis points, and slashed both the deposit and lending rates by 25 basis points.

Later in the day, traders will turn their focus to the US growth report that is expected to reveal an annualized 3.2% expansion for the second quarter, measured on a quarterly basis, following the 0.2% contraction in the first three months of the year. It would be better than the first estimate of a 2.3% rise.

 

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