FRANKFURT: European stocks ended higher Friday, pushing the Stoxx Europe 600 to its best week in five after a stunning series of sharp gains in the wake of the U.K.’s Brexit vote.
The Stoxx Europe 600 SXXP, +0.72% rose 0.7% to 332.24, the highest close since June 23, FactSet data show.
The index broke a four-week losing streak to end up 3.2% since last Friday, the strongest weekly rise since the week ended May 27. After sliding on Friday and Monday following Thursday’s landmark referendum in the U.K. to leave the European Union, the index moved higher for four consecutive sessions.
Much of Thursday’s rise of 1% was supported by a hint from Bank of England Gov. Mark Carney that a U.K. interest-rate cut was in store for the summer.
Meanwhile, investors on Friday were weighing the possibility that the European Central Bank loosening rules for bond purchases. The ECB is concerned there may not be enough debt available to buy under the terms of its current bond-buying program, as bond yields continued to fall after the Brexit vote, Bloomberg News reported.
Bank shares: On Friday, bank stocks were mixed. Most Italian banks eased from early gains after the Italian government on Thursday was given the green light by the European Commission to provide as much as 150 billion euros ($166 billion) in liquidity for banks. Italian banks have been struggling with a raft of bad loans and weak profitability in an environment of ultralow interest rates.
Shares of Banca Popolare di Milano PMI, -1.33% fell 1.3% as did Intesa Sanpaolo SpA ISP, -1.29% But shares of Banco Popolare Societa Cooperativa BP, +1.59% turned higher, ending up 1.6%,
Economic data: The jobless rate in the eurozone in May fell to 10.1% from 10.2% in April, to reach its lowest level since July 2011, the EU’s statistics agency said Friday. Also released in the morning, a Markit purchasing managers index for manufacturing in June rose to 52.8 from 51.5 in May, higher than expected.
“Given the uncertainty caused by the prospect of Brexit, it seems likely that business and consumer spending will be adversely affected across the euro area in the short term at least, pulling growth down in coming months,” said Chris Williamson, Markit’s chief economist, said in a statement.
Indexes: Italy’s FTSE MIB I945, +0.61% rose 0.6% to 16,295.78 and Germany’s DAX 30 DAX, +0.99% rose 1% to 9,776.12.
France’s CAC 40 PX1, +0.86% picked up 0.9% at 4,273.96. The U.K’s FTSE 100 UKX, +1.13% surged 1.1% to 6,577.83, a new 2016 high.
The euro EURUSD, +0.2881% fetched $1.1140, up from $1.1108 late Thursday in New York. The pound GBPUSD, -0.2554% was buying $1.3207, down from $1.3244 late Thursday. The pound was shoved lower after Carney’s rate-cut hint.
