LONDON — European stock markets made strong gains in midmorning trading on Wednesday, after the chairman of the U.S. Federal Reserve called for a cautious approach to interest rates during remarks made in New York on Tuesday.
The CAC 40 in Paris climbed 1.7 percent to 4,440.89, followed by the FTSE 100 in London and the DAX in Frankfurt, which were both up 1.6 percent, to 6,202.17 and to 10,042.19 respectively. The FTSE MIB in Milan rose 1.3 percent to 18,401.90.
The euro traded at $1.12, while the pound fetched $1.43 and the Swiss franc equaled $1.03 at 11:50 a.m. CET.
Retail and luxury stocks were also on the upswing, with the morning’s biggest gainers including Zalando, 2.3 percent to 28.85 euros; Yoox Net-a-porter Group, 3.6 percent to 26.72 euros; Asos.com, 2.5 percent to 31.84 pounds, and Metro AG, 9.9 percent to 27 euros.
Metro, the German retail and wholesale group, had announced early Wednesday that it would become two separate companies, one overseeing consumer electronics and the other wholesale and food.
The split should happen by the middle of next year, and current shareholders are to receive shares in both new companies.
Among the few stocks that were down were Koovs.com, 1.2 percent to 0.17 pounds; French Connection Group, 2.7 percent to 0.45 pounds; MySale Group, 5.1 percent to 0.42 pounds, and Italia Independent Group, 2.2 percent to 19.85 euros.
On Tuesday, Yellen suggested that further interest rate hikes should be gradual and in response to the strength of the economy.