European markets opened higher on Thursday ahead of policy decisions from the Bank of England and the European Central Bank.

The Stoxx Europe 600 index opened 0.4% higher to 300.65

Britain's FTSE 100 index opened 0.3% higher.

France's CAC 40 index opened 0.2% higher.

Germany's DAX opened 0.5% higher.

Spain's IBEX was up 0.43% in opening trade while Italy's FTSE MIB was up 0.69%.

Market participants will be tracking interest rate decisions coming in from the BoE and the ECB. Economists expect both central banks to maintain interest rates at a record low of 0.5%.

In Spain, Prime Minister Mariano Rajoy will be questioned by parliament over the recent bribery allegations against him and other senior members of Spain's ruling Partido Popular. Rajoy has rejected calls for him to resign over allegations that he received tens of thousands of euros from a slush fund held by his party treasurer.

On Wednesday, a US Federal Reserve statement refrained from giving hints as to when the planned reduction in its asset buys would take place.

The statement released after a two-day meeting of the Fed's policy making committee said the US economy was expanding at a "modest" pace, a change from the "moderate" pace seen in June.

In company news, Lloyds Banking Group said it has siphoned an extra half a billion pounds into its payment protection insurance (PPI) mis-selling fund after being hit by rising costs in compensation and administration and to deal with a regulatory probe.

According to the group's half year results statement, Lloyds, which is 39% owned by the taxpayer, has added £450m (€571m, $758m) to fund to deal with the financial industry's most expensive scandal in recent years. It will also add £50m to deal with regulatory probe related to PPI.

In other news, Italian automaker Fiat's quest to buy out Chrysler could be delayed after a US court on Tuesday refused to order a minority shareholder to sell up.

Energy major Shell, French banking group Societe Generale and Italian insurer Generali have released results.

British drug maker AstraZeneca, defence company BAE systems, the RSA Insurance Group, pharmaceutical firm Sanofi, utility firm GDF Suez, Denmark's Danske Bank, Italians firms Mediaset, Telecom Italia and utility company Enel will also put out earnings updates today.

On Wednesday, drinks producer Diageo reported a marked rise in profits in the year to June, as a robust demand for expensive whiskies and new spirits in the US helped offset sluggish growth in western Europe and some emerging markets.

In Asia and the US

In Asia, the Japanese Nikkei finished 2.47% higher on Thursday. Australia's S&P/ASX index closed 0.19% higher while South Korea's Kospi closed 0.35% higher.

Earlier in Asia, markets gained after China reported better-than-expected factory activity in July and after US data showed that the world's top economy grew faster-than-expected in the second quarter.

Sentiments were also boosted by the Fed's decision.

In China, two separate surveys on China's manufacturing sector indicated mixed activity for the month of July, amid rising concerns about continued slowdown in the economy.

The government's Purchasing Managers' Index (PMI) unexpectedly rose to 50.3 in July from 50.1 in June. Economists had expected a slowdown in activity to 49.9 for the month. Meanwhile, the HSBC PMI showed a contraction for the third straight month, declining to 47.7 in July from 48.2 in June.

On Wall Street, indices ended mixed on Wednesday. The Dow finished 21.05 points lower at 15,499.54, while the S&P 500 ended 0.23 points lower at 1,685.72. The Nasdaq closed 9.90 points higher at 3,626.37.

Social networking company Facebook briefly traded above its May 2012 IPO price of $38, but finished at $36.80. Its stock price had surged 7% on 30 July with traders exchanging 694,000 calls and 300,000 puts on Facebook that day.