The Ibex-35 resumed its upward path on Thursday and recorded its biggest advance since mid-November, after receiving the go-ahead from the U.S. Federal Reserve (Fed) on expectations of interest rate cuts in 2024.

After hopes of cuts in borrowing costs - which had triggered a strong bull run in the Ibex-35 - had cooled in recent days, the tone changed radically on Wednesday with comments from the head of the US central bank, Jerome Powell, and projections of rate cuts among the vast majority of Fed colleagues.

Powell said his historic tightening of monetary policy is probably over, as inflation is falling faster than expected, and indicated that a debate on when to cut rates was likely to begin.

Also, 17 of the Fed's 19 monetary leaders indicated in their projections that they expect rates to be lower by the end of 2024 than they are now, with the median projection showing the rate falling three-quarters of a percentage point from the current 5.25%-5.50%. None foresee higher rates at the end of next year.

Investors won't have too much time to digest the Fed's turnaround, as Thursday will bring the outcome of meetings of several central banks, including the Bank of England (BoE) and the European Central Bank (ECB), where, with no change in sight, the focus will be on both institutions' attempts to temper hopes for rapid cuts in the price of money.

"We expect both central banks to cool market expectations of rate cuts, in our view premature (the first cut is discounted for March in the Eurozone and May in the UK) and excessive in amount (the market discounts 5 ECB cuts vs. the 3 estimated by us from the summer)," said the Renta 4 brokerage house.

"The main reason to differ from the consensus view is that we believe that we cannot yet claim victory in terms of inflation control," it added.

These analysts point to the interest that the ECB's macro picture update will have.

"(The picture) will give us a better idea of how monetary authorities view the timing of the cycle (possible downward revision) and inflation (which could also moderate somewhat), which in turn will determine their future rate and balance sheet actions."

Against this backdrop and after three sessions of declines, at 0811 GMT on Thursday the selective Spanish stock market index Ibex-35 was up 126.90 points, 1.26% (its biggest rise since November 14), to 10,223.00 points, while the FTSE Eurofirst 300 index of large European stocks was up 1.38%.

The banking sector registered some of the weakest performances of the session, given the -in principle unfavorable- impact of the rate cuts in the sector: Santander rose by 1.34%, BBVA gained 0.43%, Caixabank ceded 1.44%, Sabadell fell by 2.55%, Bankinter lost 1.16% and Unicaja Banco lost 0.05%.

Among the large non-financial stocks, Telefónica gained 1.58%, Inditex advanced 1.02%, Iberdrola gained 1.96%, Cellnex gained 2.64%, and the oil company Repsol rose 0.68%.

(Information by Tomás Cobos; edited by Benjamín Mejías Valencia)