London/Paris - European stocks edged higher on Thursday in a broad-based rally after the US Federal Reserve signalled interest rates would not be raised anytime soon.
At 12:20 GMT, the FTSEurofirst 300 index of top European shares was up 0.4 percent at 1,595.79 points, after climbing to a 7 1/2-year high earlier in the session.
Britain's FTSE 100 also reached a record high of 6,982.79 points, beating the previous peak of 6,982.79 points it set on March 2.
The Fed removed the word “patient” from its statement in terms of raising interest rates, as expected, but also lowered its forecasts for the economy and inflation and for its interest rate trajectory. That signalled a more gradual path to policy normalisation than many investors had foreseen.
“(Fed Chair Janet) Yellen keeps some room for manoeuvre. Lowering the outlook made sense given the rise in the dollar and a recent batch of disappointing macro data,” said Lazard Freres Gestion strategist Julien-Pierre Nouen.
The Fed's message caused the dollar to drop and the euro to surge on Wednesday, although the euro fell back on Thursday, trading at $1.0660.
Euro zone stocks, especially Germany's DAX, have rallied in the past few months as investors bet that a weaker euro would boost the region's economy and corporate earnings.
The DAX, home of some of the euro zone's biggest exporters, underperformed on Thursday, and was down 0.2 percent.
Shares in Enel rose 2.7 percent after the Italian utility said it aims to raise profits and dividends over the next five years by focusing on emerging markets and green energy, after writedowns caused its 2014 net profit to fall 84 percent.
Shares in British clothing retailer Next, down 3.7 percent, featured among the top losers in Europe after the company gave a cautious outlook for the 2015-16 year.
Reuters