By Shubham Batra
(Reuters) -European shares ended a data-packed week on an upbeat note with stellar earnings updates and hopes of imminent rate cuts by the European Central Bank lifting investors' appetite for risky assets.
The pan-European STOXX 600 index rose 0.6% to hit a fresh two-year high, led by miners, which jumped 2.5% this week and touched a two-week high.
The STOXX index of 50 largest companies hovered around its highest level in 23 years, while a gauge of euro zone blue-chip shares hit an all-time high as investors expected ECB to start cutting rates in April.
"On balance, we continue to believe the first rate cut will be in April rather than June, but recent data and commentary is consistent with a more gradual easing cycle than we had thought," Deutsche Bank (ETR:DBKGn) economists said in a note.
German and French stocks extended gains on Friday to hit another record high.
The UK's FTSE 100 outperformed regional peers for the day with a 1.5% rise and touching an over five-week highs after British retail sales came in stronger-than-expected.
Boosting sentiment, ECB member and Bank of France head Francois Villeroy de Galhau said there are several compelling reasons why the ECB should not hold off for too long on an initial interest rate cut this year.
Meanwhile, ECB policymaker Isabel Schnabel said Europe's sluggish productivity growth may slow the fall in inflation to the ECB's 2% target.
Shares of Metso Corp jumped 9.0% after the Finnish mining equipment maker reported a fourth-quarter profit beat and gave an optimistic outlook for its aggregates unit.
NatWest (LON:NWG) advanced 7.1% as the British bank posted a forecast-beating profit for 2023. The lender is gearing up for a crunch sale of state-owned stock in the company after a scandal-hit year.
Sika (SIX:SIKA) rose 2.8% after the Swiss construction chemical maker reported annual earnings in line with analyst estimates on Friday and said it expects sales to increase 6%–9% in 2024.
Nibe Industrier dropped 13.4% to the bottom of STOXX 600 as the Swedish heat pump maker said its weaker performance would continue in the first half of 2024 after it saw a decline in demand in the second half of last year.
Eni slid 3.1% after the Italian energy group reported a fourth-quarter adjusted net profit of 1.64 billion euros ($1.8 billion), beating analysts' expectations.
ASML (AS:ASML) Holdings was up 1.6% after semiconductor equipment supplier Applied Materials (NASDAQ:AMAT) forecast better-than-expected second-quarter revenue on strong demand for advanced chips used in artificial intelligence.