Miners led European shares upward on Friday as a Chinese group bought a stake in Rio Tinto giving a shot in the arm to mining and metals companies ahead of key US jobs data later in the day.
In late morning trade, the FTSE Eurofirst 300 rebounded 1.1 per cent 1,343.80, while Germany's Xetra Dax rose 1.1 per cent to 6,928.28 and in Paris the CAC 40 added 1.6 per cent to 4,945.46.
Rio surged 14.1 per cent to 565p when Chinese aluminium producer Chinalco said it had bought a 12 per cent stake in the company jointly with US producer Alcoa.
The news gave a lift to the metals sector with France's ArcelorMittal up 5.4 per cent to EU46.46, mining firm Eramet gaining 1.3 per cent to EU349.90, Norwegian aluminium producer Norsk Hydro (NYSE:NHY) rising 6.2 per cent to NKr67.30 and Swedish steel company SSAB's B-shares up 4 per cent to SKr157 and Germany's Saltzgitter up 5 per cent to EU109.55.
Banks also rebounded after bond issuer MBIA offered reassurance on its profitability late Thursday easing jitters that defaults by monoline bond insurers would impact banks' profitability.
"The financial sector is rocking back and forth between negative stories and the Fed and companies trying to reassure investors that the situation is not as bad as they fear," said Philippe Gijsels, senior equities strategist at Fortis Global Markets.
France's Natixis rose 2.2 per cent to EU11.58, Germany's Deutsche Bank (NYSE:DB) rose 0.8 per cent to EU75.81 while Commerzbank rose 1.5 per cent to EU20.57.
Société Générale jumped 4 per cent to EU14.97 on continued takeover talk, but Swiss wealth manager UBS (NYSE:UBS) failed to recover lost ground falling 3.7 per cent to SFr42.66, while domestic rival Credit Suisse (NYSE:CS) fell 1.2 per cent to EU60.10.
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