MILAN/FRANKFURT: European stocks rose on Friday, tracking an upbeat sentiment from Wall Street on hopes of a faster global economic recovery, while Frankfurt shares lagged after data showed a decline in industrial orders.

The STOXX 600 gained 0.4% and was set for its longest winning streak since late December. The index was also up 3.7% for the week, on track for its best weekly performance since November.

Markets around the world were higher on expectations of a large stimulus by US President Joe Biden's administration, while a pause in the Reddit-driven retail trading frenzy also helped lift investor sentiment.

"Global markets are now revisiting a familiar script, with investors pushing broad asset classes higher on more signs pointing to the US economic recovery," said Han Tan, market analyst at FXTM.

Germany's DAX index was flat after data showed orders for German-made goods fell more than expected in December, ending a seven-month streak of positive data as restrictions to contain the COVID-19 pandemic dragged down demand from other euro zone countries.

"Today's data shows that stricter lockdown measures since mid-December, as well as the Christmas break, have finally hit German industry ... but at face value, this only looks like a temporary breather," strategists at ING wrote in a note.

Most European sector indexes were trading higher, with banks, travel and leisure and technology shares leading the advance, suggesting a risk-on trading environment. With the reporting season underway, investors also parsed through earnings reports from European companies.