European stocks surge as U.S. expected to raise interest rates

European stock markets pushed ahead as futures markets predicted a solid open on Wall Street ahead of the expected rate hike from the Fed.

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Despite a faltering start to Wednesday's session, the Stoxx 50 index of leading European shares was up 0.7 per cent. European shares are tracking the anticipated open on Wall Street. Futures markets are pointing to a 0.5 per cent advance of the Dow at the bell.

Though some in the markets question the ability of the U.S. economy to withstand higher U.S. interest rates, there is relief that the uncertainty over the Fed's intentions is coming to an end.

"Whether this optimism turns into a full blown Santa rally or not will depend on the Fed's ability to manage expectations and reassure investors than the tightening cycle will be very gradual," said Craig Erlam, senior market analyst at OANDA in London.



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