European stocks closed at a two-year high Friday as investors digested the European Central Bank's latest decision, fresh economic data and fourth-quarter earnings.
European markets
The pan-European Stoxx 600Â closed 1.1% higher, with sectors in mostly positive territory. Household goods jumped 5.2%, while tech stocks shed some of their recent gains, trading 0.7% lower.
Despite a shaky start to the year, a strong week has taken the regional index to its highest level since Jan. 17, 2022, according to LSEG data.
French drinks maker Remy Cointreau topped gains, rising 15%, after reporting a smaller than expected decline in third-quarter sales. Luxury fashion house LVMH also rose 13% as increased fourth-quarter sales signaled a boost for the luxury sector.
The ECB met market expectations Thursday and held interest rates steady at their current record high. The euro zone deposit rate was kept at 4% for the third straight meeting and the ECB reiterated that it would keep rates high for a "sufficiently long duration" to bring inflation to target.
Despite this, the market continues to see the central bank pivoting to rate cuts in April or June, once data on spring wage negotiations has come in. The ECB indicated Thursday that domestic inflationary pressures are easing and price rises are moving in the right directon.
U.K. consumers are their most confident since January 2022, buoyed by falling inflation, new survey data showed Friday. The sentiment was echoed in France but not in Germany.
Stateside, U.S. stocks were slightly higher after economic growth for the quarter came in well above expectations.
Asia-Pacific markets mostly declined Friday as electric vehicle stocks in the region dropped for a second day, while investors also digested inflation data from Tokyo.