European stocks posted their biggest weekly gain in 12 weeks on Friday, led by banking stocks, as investors awaited signs of a possible ceasefire between Russia and Ukraine.
The pan-European STOXX 600 index rose 0.2 percent, bringing its total weekly gains to 2.2 percent.
The eurozone banking index rose 1.9% today, achieving the best sectoral performance since the beginning of the year with gains of 56.8%.
Bank stocks benefited from investors’ shift to local equities due to uncertainty surrounding US tariff policies, while analysts also highlighted strong corporate performance during the earnings season.
“Financial sectors are back to be the most prominent,” said strategists at Bank of America Global Research.
Globally, investors are monitoring geopolitical developments after Bloomberg News reported that the United States and Russia are seeking to reach an agreement to cease the war in Ukraine, which would secure Moscow’s occupation of the territories it seized during its invasion.
Defense sector shares fell 0.8 percent on the day, posting year-to-date gains of 51.4 percent, narrowly outperforming the banking sector.
Shares of German reinsurance company Munich Re fell 7.2 percent, making it one of the biggest losers on the benchmark index, after it lowered its insurance revenue forecast for the fiscal year.
Insurance sector shares fell 1.6 percent, a day after hitting an all-time high.
Data compiled by the London Stock Exchange Group indicates that of the 198 companies listed on the STOXX 600 index that reported earnings as of Tuesday, 53 percent exceeded analysts’ expectations.
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