Investors looked past weaker manufacturing data and a rate hike from the Chinese central bank in Europe on Friday to focus on a solid U.S. jobs report, a possible repeal of bank regulations and price action in oil markets.
The U.S. jobs report Friday showing a solid print of 227,000 new jobs signaled the U.S labour market began the year in a position of strength, which has positive connotations for the global economy.
At the same time oil prices were lifted in the European noon thanks to an order by the Trump White House imposing a new round of sanctions against Iran in response to a ballistic missile test carried out earlier in the week.
Brent crude, the European benchmark, was up by more than 1% and trading at $57 shortly before stock markets closed. Oil majors were also higher for the session.
The FTSE 100 index in London was up 0.81%%, at 7,198 by the close, while the DAX in Germany gained 0.32% to 11,664. The CAC 40 in Paris rose 0.81% to settle at 4,832 and the IBEX in Spain was up 0.60% to 9,462. The FTSE MIB in Italy was up 1.20% to 19,116.
In London, RBS (RBS) and Barclays (BCS) topped the FTSE 100 in London, with gains of more than 3% as investors reacted to reports of an imminent announcement expected from President Trump about the future of consumer protections and banking restrictions under the Dodd-Frank Act.
Pharma companies Astrazeneca (AZN - Get Report) and Hikma Pharmaceuticals (HKMPY) were also up as investor reacted to recent earnings from the sector and concerns over the Trump effect on drug company profits eased further. The president seems to have backed away from plans to curtail the ability of firms to make large increases to drug prices.
The lender missed expectations for net income, which came in 7% below consensus at €776 million ($838 million), and appeared to suggest that dividends will be lower during the year ahead. But investors took heart from stable capital buffers, lower loan losses and fee income that was 10% ahead of consensus at the top line, at just over €2 billion. Intesa shares were up more than 2% by the close on Friday.
In Spain, Banco Popular (BPESF) stock fell by as much as 8% in Spain after reporting a larger than expected loss for the fourth quarter, at €3.6 billion ($3.8 billion), and a weaker capital buffer which has fed speculation it might be forced into a rights issue over the coming months.
Deutsche Bank (DB - Get Report) stock featured near the top of the DAX in Germany after claiming the bottom spot on Thursday. The shares gained nearly 2% as the lender pared losses racked up after it reported a larger than expected quarterly loss on Thursday.