US jobs data lift European shares even as bank earnings weigh

European shares ended higher on Friday, as upbeat US jobs data in January and fresh optimism about the US-China trade spat offset weak bank earnings, gloomy euro-zone macro data and a rout in Germany's Wirecard after a report of fraud spooked. The STOXX 600 index was up 0.3 percent with most European bourses slightly in positive territory. The index extended its new year rally into a fifth straight week.
"Yet another stellar month of US job creation has provided more good news for investors, who have not exactly been short of positivity of late," said Chris Beauchamp, chief market analyst at IG. Signs overnight that the US-China trade talks were progressing boosted sentiment, offseting Chinese factory data that underscored concerns about the cooling growth in the world's No. 2 economy.
Trade-sensitive assets, European car makers, rose 1 percent to a three-month high.
Corporate earnings across Europe provided some hope even as analysts said the fourth-quarter results so far this season have exposed a significant reduction in growth.
Electrolux was the second biggest gainer, with forecast-beating profits sending shares in the home appliance maker up 10 percent to their highest in April last year.
JCDecaux revenues also cheered investors, boosting the French company's shares about 5.5 percent.
Metro Bank, whose stock has halved in value following an accounting error, snapped a five-day losing streak and was the top gainer. Its shares were last up 10.4 percent.
Thyssenkrupp rose 2.7 percent after saying first-quarter earnings would be in line with its outlook, giving its ailing shares a boost ahead of a plan to spin off its capital goods businesses.
The world's top maker of diabetes drugs, Novo Nordisk , also saw its shares rise after giving a positive earnings update.
Banking stocks were a big drag across the euro zone, particularly in Italy where the sector lost 2.1 percent after a dismal factories activity survey fuelled concern about a rising budget deficit and the outlook for an economy that has slipped into recession.
Spanish banks pulled the Madrid bourse down 0.4 percent after results from Caixabank and TSB, the UK subsidiary of Spanish lenders Banco Sabadell.