European equity markets ended the week with their best performance since April, driven by strong gains in banking and healthcare stocks.
Investors responded positively to earnings updates and shifted funds into cyclical sectors after several weeks of tech-led rallies, pushing benchmark indexes higher across major exchanges.
Market participants pointed to improving sentiment around bank profits and steady demand in healthcare, which helped balance weakness in commodity-linked stocks. Trading volumes rose as institutional investors repositioned portfolios ahead of upcoming central bank announcements.
Analysts attributed part of the rally to better macroeconomic data and lower expectations of aggressive policy tightening. However, some strategists cautioned that global growth concerns still warrant a selective approach to stock picking.
Equity strategists said that while the market momentum is encouraging, valuations will need sustained earnings growth to confirm a durable breakout.
Activity in the options market showed that investors were adding exposure to cyclical stocks while also buying protection, signaling a measured optimism.
In currency markets, trading remained stable, and bond yields moved little as fixed-income traders assessed economic data and central bank commentary.
Overall, the weekly rally demonstrated a renewed risk appetite among European investors, even as geopolitical tensions and commodity price volatility continue to pose potential headwinds.
