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PARIS: European shares jumped on Thursday, with China-exposed stocks such as luxury and miners outperforming on news of aggressive Chinese economic stimulus, while chip stocks also advanced following US firm Micron’s strong revenue forecast.

The pan-European STOXX 600 index closed 1.3% higher at 525.61 points, an all-time closing high and 0.2% away from the intraday record high.

Chinese leaders pledged to deploy “necessary fiscal spending” to meet this year’s economic growth target of roughly 5%, acknowledging new problems and raising market expectations for fresh stimulus on top of measures announced this week.

“This is a very positive market reaction that will probably fade a little bit with time because issues around Chinese demand are going to take time to solve,” said Tim Graf, managing director and head of macro strategy for EMEA at State Street Global Markets.

“You’re seeing a little bit of a relief rally that there are efforts being taken to solve them, but it’s still a very long process.” China-exposed luxury firms such as LVMH and Hermes gained around 9% each. A gauge of ten of Europe’s biggest luxury firms rose 6.5%.

Mining stocks also jumped 4.3% on elevated base metal prices.

Europe’s technology sector gained 3% as shares of semiconductor companies jumped after Micron Technology forecast higher-than-expected revenue on AI demand.

Bucking the trend, heavyweight energy shares eased 3% as crude oil prices dropped more than 2% on a media report that Saudi Arabia will give up its price target in preparation for raising output, and as OPEC+ looked set to raise output in December.

In Switzerland, the country’s central bank reduced interest rates by 25 basis points, echoing steps to lower borrowing costs by the European Central Bank (ECB) and US Federal Reserve, and left the door wide open for more rate cuts as inflation cools sharply. The Swiss benchmark closed 1.4% up.

Policy doves at the ECB are preparing to fight for an interest rate cut next month after a string of weaker-than-expected economic data, a move likely to meet resistance from their more conservative peers, seven sources told Reuters.

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