European stocks close higher after UK GDP data and earnings; Richemont shares rise 3.5%

The outlook is challenging, Klaas Knot, chair of the Financial Stability Board said at the G-7, adding that a U.S. default would create unwelcome volatility.

Jeremy Hunt, U.K. chancellor of the exchequer, speaks to CNBC's Martin Soong in an international exclusive at the G-7 finance summit in Japan.

Giulio Terzariol, chief financial officer of Allianz, discusses the latest company results.

Christian Nolting, chief investment officer at Deutsche Bank, says the European Central Bank and Bank of England are probably not done hiking interest rates.

French reinsurer Scor topped the Stoxx 600 index, following positive first-quarter results.

The group's net income came in at 311 million euros ($339 million) in the most recent three-month period, compared to a net loss of 35 million euros across the same timeframe last year.

Shares rose as much as 10% following the release.

Soitec shares shed 7% in morning trade, after JP Morgan slashed the semiconductor company's target price from 195 euros to 100. The bank moved Soitec to "underweight" from "neutral" on account of slowdown in the market, indicated by sector leader Qualcomm.

— Hannah Ward-Glenton

Shares of luxury goods group Richemont climbed 7.5% after its full-year results to the end of March showed operating profit rose to an all-time high of 5.031 billion euros ($5.491 billion).

Sales at the Swiss firm also hit a new record of 19.9 billion euros, ahead of estimates.

Luxury stocks have scaled new highs in recent years and are now benefiting from the return of Chinese travelers, with France's LVMH in April becoming Europe's first $500 billion market cap company.

LVMH and Kering shares were also higher Friday.

— Jenni Reid

Jeremy Hunt, U.K. chancellor of the exchequer, speaks to CNBC's Martin Soong in an international exclusive at the G-7 finance summit in Japan.

European stocks were higher early Friday, with the benchmark Stoxx 600 up 0.36%, as markets look for a positive end to the week after three straight declines.

The U.K.'s FTSE 100 was up 0.4% after U.K. first-quarter GDP showed 0.1% growth but was dampened by squeezed household incomes and strike action.

France's CAC 40 was 0.77% higher, while Germany's DAX was up 0.3%.

— Jenni Reid

A U.S. debt default would bring unwelcome volatility and represent "the mother of all shocks," Klaas Knot, the Dutch central bank governor, told CNBC Friday.

U.S. Congress is trying to find a compromise on the debt limit — which refers to the maximum amount of money that the two chambers allow the federal government to borrow. Democratic leaders want the limit to be raised, but Republican lawmakers have called for spending cuts to be agreed before anything is approved.

Time is running out for an agreement, with U.S. Treasury Secretary Janet Yellen warning earlier this month that without a deal, the largest economy in the world could risk default by June 1.

Speaking at the sidelines of a G-7 meeting in Japan, Knot, who is also the chair of the Financial Stability Board, said a potential U.S. default, "will create volatility, that volatility is definitely not welcome."

"The banks have to be resilient in order to be able to cope with shocks like this. [A U.S. credit default] would of course be the mother of all shocks so let's agree that we hope that this financial system will not have to cope with these shocks, but so far we have significantly strengthened the solvency, liquidity of the financial institutions," he said.

— Silvia Amaro

The U.K. economy grew by 0.1% in the first quarter, figures published Friday morning showed, though March gross domestic product was down by 0.3% from the month prior.

Factors including high inflation squeezing household incomes, falls in wholesale and retail trade and unusually wet weather dampened economic activity.

— Jenni Reid

European markets are set to open higher on Friday.

The U.K.'s FTSE 100 was last seen opening 26.2 points higher at 7,751, according to IG. France's CAC 40 was set to open up 23.3 points, Germany's DAX up 40 points and Italy's MIB up 86.4 points.

— Jenni Reid

The European Union will see moderate growth despite persistent core inflation, as long as fiscal policy does not fuel inflation, European Commissioner for the Economy said.

"The task of fighting inflation is not finished, we still have very strong core inflation in Europe," Gentiloni told CNBC's Martin Soong at the G7 Finance Ministers and Central Bank Governors meeting in Niigata, Japan

He added that he expects the euro zone to see "moderate growth, not recession."

"We have to be careful with our fiscal policy, we cannot fuel inflation with our fiscal policy," he said.

The crisis seen in U.S. regional banks and Credit Suisse should "wake up all our regulation efforts," Gentiloni said.

— Clement Tan

Bank of America expects shares of a U.K. company that provides investors with direct exposure to uranium price movements, will rise by 55% over the next 12 months.

With uranium production concentrated mainly in Kazakhstan and Canada, the bank expects supply constraints to continue, further supporting uranium prices.

CNBC Pro subscribers can read more here.

— Ganesh Rao

Bank of England Governor Andrew Bailey speaks to CNBC's Joumanna Bercetche after the central bank's rate decision and growth upgrade.