A surge in bank stocks helped to push European benchmarks on Wednesday as investors reacted to hawkish remarks made by Federal Reserve chair Janet Yellen a day earlier, while also preparing for her second appearance before lawmakers on Wednesday.

Banks drew support from the renewed focus on tighter monetary policy, even if it is limited to the U.S. for the time being, which pushed the U.S. dollar up and bond yields higher across the developed world.

According to data from analysts at Barclays, nearly half of all European banks reporting in the current season have beaten expectations for earnings, while two thirds have beaten estimates for sales.

In the economic sphere, U.K. unemployment fell further during January, although the drop jobless claims wasn't enough to push the unemployment rate any lower than its current 4.8% level.

British wage growth figures fell and were below expectations during the three months to the end of January, at 2.6%, which is important given the acceleration of inflation brought about by the post-referendum devaluation of the pound.

The FTSE 100 rose by 0.49% to 7,305 in London while the mid-cap FTSE 250 hit a new peak of 18,847.

The CAC 40 rose by 0.55% in Paris, to be quoted at 4,922, while the DAX in Frankfurt gained 0.20% to 11,795.

In New York, the S&P 500 is called to open 0.03% higher while the Dow Jones is seen 0.15% higher following the opening bell.

Ashtead  (ASHTF) and BHP Billiton  (BHP) were at the top of the FTSE 100, followed closely behind by Royal Bank of Scotland (RBS) , Barclays (BCS) and Lloyds Banking Group (LYG) .

BHP Billiton was up following an announcement on Tuesday that striking workers at its Escondida mine in Chile, the world's largest copper mine, have entered government backed mediation.

This is while Ashtead, a construction equipment rental firm with a large portion of its operations in the U.S., has been a beneficiary of a resurgent US dollar.

Deutsche Bank  (DB - Get Report) , Commerzbank  (CRZBY) and Deutsche Lufthansa (DLAKY)  were the biggest risers in Germany.

In France, Credit Agricole  (CRARY) rose by more than 4%, to the top of the CAC 40 index after it beat expectations for earnings in the fourth quarter.

The French firm reported a 14% beat for profit before tax, a solid performance across all divisions and announced a dividend that was in line with market expectations.

It was supported in its advance by BNP Paribas  (BNPQY) and Societe Generale  (SCGLY) .