European stock markets post best week in seven months

European banks recovered all their pandemic losses, US banks have surged to record highs, while retailers, oil and gas and travel stocks all rose

The Ftse-100 has bounced back to pre-pandemic trading levels.

European stocks marked their best weekly performance in seven months, as a bright start to the earnings season helped ease investor concerns about higher inflation.

The pan-European Stoxx-600 index rose 0.7% to close at a one-month high, ending the week with a 2.6% gain after a sharp rebound in risk appetite in the past two sessions.

Banks were the top boost to the index, up 1.8% after forecast-beating quarterly results from Wall Street's biggest lenders on an economic rebound and deals bonanza.

European banks recovered all their pandemic losses to trade at pre-pandemic levels, while US banks have surged to record highs recently.

Retailers, oil and gas and travel stocks all rose between 1.6% and 2%.

"A renewed focus on the bottom-up news has helped global equities over the last couple of sessions, and results from the US banking sector delivered another significant boost to indices overnight," said Peel Hunt analyst Ian Williams.

European earnings kick into high gear in the next few weeks, with analysts expecting a near 47% jump in third-quarter profit for companies listed on the Stoxx-600. Energy and industrial companies are forecast to provide the biggest boost to earnings performance.

Europe's inflation upswing is still seen as temporary and there are no signs yet that the recent surge is becoming embedded in wages, ECB President Christine Lagarde said on Thursday.

Investors have fretted over rising inflation caused by a global energy crisis, supply-chain bottlenecks and labour shortages slowing a corporate profit rebound from the pandemic shock.

-Reuters