European stocks rallied after FED rate hikes

European stock markets opened with strong gains Thursday as the Federal Reserve ended months of uncertainty by raising USA interest rates for the first time in almost a decade.

Germanys DAX surged over 3 percent, its biggest rise since August, and Britains FTSE 100 and Frances CAC 40 leapt 1.4 and 2.5 percent, respectively.

Banking stocks rose as lenders typically make more money in a higher interest rate environment.

The European stock markets were following the lead given by markets in the USA and Asia.

The FTSE is down by around 6 percent since the start of 2015, having fallen back from a record high of 7,122 points set in April.

The Fed said the rise was part of a "gradual" process to get rates back to normal after years of being near zero.

The Hang Seng Index ended at 21,872.06, up 171 points or 0.79 percent, with the Hang Seng China Enterprises Index gaining 1.34 percent to close at 9,666.52.

"With the Dow rising steadily from the moment [Fed chairwoman Janet Yellen] first opened her mouth, the rosy picture she painted of the United States economy and the absence of major overseas threats has sent markets surging with relief", said Robert Craig, private client investment manager at MB Capital.

"Considerable improvement" in the jobs market spurred the Fed into action. The euro traded lower against the dollar, dropping to $1.0860.

Overall, this year has been a hard year for stocks, but if the rate hike does come, then this is a clear signal that the economy is getting better.

Sainsbury's was the only one of the Big Four major supermarkets to see sales rise in the Kantar data, putting it on track to claim top spot among the major grocers in the all-important Christmas trading season.

Gold fell more than 1 percent.