Euro shares sharply higher on U.S. GDP, euro zone hopes; DAX up 1.62%

Investing.com - European stocks closed sharply higher Friday on strong U.S. economic data, while comments by European Central Bank President Mario Draghi and speculation of further easing measures by the Federal Reserve supported sentiment. 

At the close of European trade, the EURO STOXX 50 soared 2.23%, France’s CAC 40 jumped 2.28%, while Germany’s DAX 30 added 1.62%.

Sentiment found support after ECB President Draghi said on Thursday that the bank will do whatever is necessary to preserve the euro.

In a speech in London, Draghi appeared to indicate that the ECB would be prepared to intervene to lower Spanish and Italian bond yields, saying that government borrowing costs would fall within the central bank’s mandate if they interfered with the 'transmission' of monetary policy.

Helping the global stock rally, gross domestic product in the U.S. rose in the last quarter, preliminary official data showed on Friday.

In a report, the Bureau of Economic Analysis said that GDP rose to a seasonally adjusted annual rate of 1.5%, from 2.0% in the preceding quarter whose figure was revised up from 1.9%.

Analysts had expected U.S. gross domestic product to rise 1.5% in the last quarter.

In addition, U.S. UoM consumer sentiment rose unexpectedly last month, data showed on Friday.

In a report, the University of Michigan said that consumer sentiment rose to a seasonally adjusted 72.3, from 72.0 in the preceding month.

Analysts had expected UoM consumer sentiment to remain unchanged at 72.0 last month.

Financial stocks were broadly higher, as Spanish lenders Banco Santander and BBVA rallied 2.24% and 1.67%, while Italy's Unicredit and Intesa Sanpaolo advanced 1.78% and 1.03% respectively. 

France's BNP Paribas also climbed 1.77%, while Germany's two biggest lenders Deutsche Bank and Commerzbank rose 0.38% and 0.99%.

Meanwhile, French aerospace and defense giant EADS surged 6.17% after it said that first-half profit rose 89% and the company lifted its full-year earnings forecast as Airbus SAS delivered more planes. 

Also in earnings, PPR, the French owner of the Gucci luxury brand, climbed 4.53% as it reported first-half recurring operating income rose 20% to EUR815.3 million in the six months ending June 30. 

On the downside, Europe’s biggest supplier of building materials, Saint-Gobain, plummeted 9.23% as it reduced its full-year outlook because of the euro zone's debt crisis. 

In London, commodity-heavy FTSE 100 gained 0.97%. 

Oil and gas major Anglo American tumbled 3.12% after saying first-half earnings slid 46%, more than analysts expected, as commodity prices declined. BP saw shares decline 0.18%.

Mining stocks were mixed, as shares in copper producers Antofagasta and Kazakhmys dropped 1.23%, and 0.58% respectively, while rival Xstrata advanced 0.66%.

Elsewhere, financial stocks were also mixed. Barclays led gains with shares rallying 4.33%, after announcing that pretax profit excluding debt-valuation adjustments and other one-time items for the six months ending June 30 rose 13% to GBP4.2 billion pounds.

Meanwhile, the Royal Bank of Scotland edged down 0.12% and HSBC Holdings dropped 0.32%, while Lloyds Banking saw shares retreat 0.46%.

In the U.S., shares followed sharply higher with the Dow up 0.84%, the S&P 500 higher by 1.05% and the Nasdaq up 1.08% in midsession trade.

Also Friday, official data showed that Spain's unemployment rate rose slightly less-than-expected in the second quarter, ticking up to 24.6% from 24.4% in the previous quarter. Analysts had expected Spain's unemployment rate to rise to 24.9% in the second quarter.