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Europe stocks close higher on dovish Carney speech; oil weighs

European stocks rose in late trade Thursday as Bank of England Governor Mark Carney gave a dovish speech over the fallout from the U.K.'s referendum result.

Carney speaks

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After trading in a tight range for much of the session, bourses rose higher before the close as Carney spoke at the Bank of England in London. At the hastily scheduled speech, he said that the bank could deploy further stimulus this summer and had a wide range of tools available.

"The economic outlook has deteriorated and some monetary policy easing with likely be required over the summer," Carney said in a speech at the Bank of England in London.

The FTSE 100 closed higher by 2.3 percent provisionally with the Euro Stoxx 600 closing up 1 percent. This came as sterling sank lower as the likelihood of more liquidity weighed on the U.K. currency which has been hit hard in the wake of the Brexit vote.

"Well if Mr Carney was vociferous in warning about economic risks before the referendum, he has nailed his colors to the post with this speech," Marc Ostwald, a strategist at ADM Investor Services International Limited, said in a note.

Oil prices fall

Meanwhile, on the oil front, both Brent and U.S. crude fell sharply on Thursday, as returning supply from Nigeria added pressure to the market. Brent and U.S. WTI were hovering around $49.65 and $48.75 respectively. Metal prices were mixed to mostly higher which boosted several mining stocks such as Glencore, Anglo American and BHP Billiton.

Overseas, Asia markets ended mixed, while in the U.S., stocks opened slightly higher, despite losses in the oil market.

Deutsche Bank fails Fed stress tests

In individual stock news, U.S. bank subsidiaries of Deutsche Bank and Santander have failed the U.S. Federal Reserve stress tests again with U.S. regulators flagging up "broad and substantial weaknesses" in their capital planning. Deutsche Bank shares hit a 30- year low during trade, according to Dow Jones. Shares finished lower by 2.7 percent.

Elsewhere in the banking sector, UniCredit shares fluctuated from lows to highs during trade, and closed up 1.8 percent. During the session, the Italian lender confirmed that it had appointed French investment banker Jean-Pierre Mustier as its new CEO. He is expected to take on the role on July 12.

Elsewhere, Monsanto has asked Bayer to increase its takeover offer, reportedly demanding an extra $10 to $15 a share, according to unnamed sources cited by German business daily Handelsblatt. "Insiders" also told the paper that the mega-merger between the two agro-chemical giants had been thrown into doubt by the Brexit vote. Bayer shares finished moderately lower.

UK data

Weir Group popped nearly 3 percent as HSBC raised its price target on the stock. The engineering firm also announced that its chief operating officer was to step down from the board in late September.

On the data front, the U.K. economy grew by 0.4 percent in the first quarter of 2016, in line with expectations; while annual inflation in the euro zone is expected to come in at 0.1 percent for June, up from -0.1% in May, according to a Eurostat flash estimate.

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