Europe stocks close sharply up as banks rally 2.15%; miners boosted by China

European stocks closed on Friday sharply higher, as a positive morning trade on Wall Street, a strong rally in banks, and better-than-expected inflation data from China helped lift sentiment.

The pan-European STOXX 600 finished up 1.29 percent, with all sectors posting solid gains. However, following a number of weak sessions, the STOXX 600 closed up only 0.09 percent on the week.

The U.K.’s FTSE 100 ended 0.51 percent up on Friday, while the French CAC 40 and German DAX extended gains, closing 1.49 and 1.60 percent higher.

Producer prices in the world’s second-largest economy headed higher for the first time in almost five years, offsetting the negative sentiment generated Thursday by poor export data from the mainland. The news, as well as a selection of price target raises, gave a boost to the miners, with stocks Anglo American and BHP Billiton closing above 1.5 percent each. The rise in U.K. miners helped push the FTSE 100 back above the 7,000 level during trade.

Bank earnings helped provide a lift to markets both in the U.S. and Europe, after JPMorgan Chase, Wells Fargo and Citigroup all posted better-than-expected results, beating estimates on both top and bottom lines.

The Federal Reserve was also back on the table, with investors looking ahead to a speech by Fed Chair Janet Yellen, to see if she provides any clues on Friday as to when a U.S. rate hike is likely to come. It takes place after Europe’s market close.

On the oil front, prices switched from gains to losses on Friday, as a stronger U.S. dollar weighed on sentiment, and as traders waited for an industry report, which would reveal if oil drillers in the U.S. were ramping up activity, Reuters reported.

At the market close, Brent traded at $51.52, while U.S. WTI stood at $49.95 per barrel.

Man Group soars 13.8%

Looking at stocks, Man Group was the day’s best performer after it acquired Aalto, a real asset-focused investment manager for $25 million. The company also posted a 6 percent rise in funds under management in the three months to September 30. Shares soared 13.79 percent.

Banking was the top sector performer on Friday, with Banco Popolare jumping 6.25 percent after it said that it had sold bad loans worth 618 million euros. Meanwhile, Banca Popolare di Milano rallied 6.1 percent ahead of a shareholder meeting about its planned merger with Banco Popolare.

France’s SFR jumped almost 4 percent, after Altice said it had bought a 5.21 percent stake in the firm, raising its overall holding of the company above 82 percent.

Software AG fell to the bottom of the STOXX 600, slipping 8.71 percent, after its latest earnings report disappointed investors.

Source: CNBC