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Europe surges 2.8% at close; VW, Yellen in focus

European stocks closed sharply higher on Friday, as concerns over the health of the global economy dimmed slightly after the U.S. Federal Reserve suggested it was still on course to raise interest rates in 2015.

The pan-European STOXX 600 finished Friday higher by 2.8 percent. On the week however, it was down 1.6 percent.

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IBEX 35
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London's FTSE 100 ended 2.5 percent higher, while the German DAX finished up 2.8 percent, despite concerns about Volkswagen, which is one of Germany's major employers.

The French CAC saw a 3.1 percent pop, buoyed by data showing France's consumer confidence index at its highest since October 2007.

In the U.S. stocks traded higher Friday, as investors digested remarks from Janet Yellen, the chair of the U.S. Federal Reserve.

In a speech on Thursday, Yellen said that an interest-rate hike would likely be appropriate "sometime later this year," although the decision hinges on the strength of economic data.

Autos jump; Miners in focus

In Europe, Volkswagen continued to dominate traders' minds, with the automaker seeing a sharp decline by the close, slipping 3.4 percent. Investors waited to hear who the company's next chief executive would be, following the resignation of Martin Winterkorn on Wednesday. Its stock has slumped 28 percent this week, following reports that VW used software to benefit its diesel engines' performance under U.S. test conditions.

After the close, Matthias Mueller was named as the new CEO, as expected.

The scandal continued to impact other European automakers on Friday.

German carmaker BMW saw shares finish up 4.2 percent, bouncing back from Thursday when a report in magazine Auto Bild said that the company could also be involved in emissions manipulation. The publication later backtracked on its claim and BMW denied any wrongdoing.

On Friday, Renault, Daimler and Fiat Chrysler all finished sharply higher, while Porsche (owned by VW) closed 3.2 percent lower.

Mining stocks rebounded on Friday, but underperformed other sectors as the commodity slump continued to keep investors on their toes.

London-listed Anglo American and Antofagasta failed to hold onto positive territory, closing 1.6 and 1.1 percent lower respectively.

Glencore shares hit an all-time low of 95 pence, after benchmark copper on the London Metal Exchange hit its lowest level since July 2009. However, the copper-focused mining and commodities trading giant pared some losses by the close, finishing 1.4 percent down.

Meanwhile, Adidas shares closed up 4.1 percent after the sportswear maker got a boost from better-than-expected sales from Nike.

Other than Anglo American and Antofagasta, there were just a handful of stocks in the red, of which Zodiac Aerospace was at the bottom. Shares closed down 6.8 percent after reports emerged that the French company had lost a contract with a key client, American Airlines.