LONDON, March 3 (Reuters) - European stocks extended gains
and bond yields fell in a sharp risk-on trade after the U.S.
Federal Reserve cut interest rates on Tuesday by a half
percentage point in an emergency move.
The Fed said it was cutting rates to a target range of 1.00%
to 1.25%, saying "the coronavirus poses evolving risks to
economic activity". The pan-European STOXX 600 .STOXX index jumped 3.2% to day
highs after the news, while German bond yields briefly fell with
10-year yields last up 3 bps on the day at -0.59% DE10YT=RR .
Italian bond yields extended their falls, with 10-year
yields last down 9 bps on the day at 1.06% IT10YT=RR .
Britain's pound meanwhile rose further and was last up 0.6%
on the day at $1.2825 GBP=D3 .
"We are seeing talk translating into action which is very
welcome," Peter Kinsella, head of FX strategy at UBP.