PARIS: European shares hit their highest in over a year on Friday and ended their fourth straight week in the green, buoyed by positive earnings from major US banks and hopes of an end to the Federal Reserve’s rate-hiking cycle.
The pan-European STOXX 600 closed up 0.6% on Friday, after hitting its highest level since February 2022 earlier in the session. The index gained 1.7% for the week, clocking its longest weekly winning streak so far in 2023.
The blue-chip STOXX 50 index also advanced 0.6%, hitting a 22-year peak.
European shares have gained momentum in April with France’s CAC 40 hitting record highs multiple times in a row, following evidence of cooling US inflation as well as an improving outlook for the euro zone economy.
“April is one of the strongest months of the year (for Europe stocks) so you tend to see strong seasonal inflows. Also, investors have been optimistically pricing in two Fed rate cuts at the second-half of this year and maybe only one more rate hike to come,” said Giles Coghlan, chief market analyst at HYCM.
On Friday, European banks were the top gainers on the STOXX 600, jumping 3.0% to hit a one-month high after upbeat first quarter earnings from big banks in the United States, which had been keenly awaited following the recent turmoil in the banking sector.
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