This is CNBC’s live blog covering European markets.
European equity markets opened higher on Friday to cap a positive week for stocks.
The U.K.’s FTSE 100 and Germany’s DAX opened higher by 0.2%, and France’s CAC 40 gained 0.7% in early trade.
Meanwhile, the pan-European Stoxx 600 index was in positive territory by 0.5%.
Among the biggest gainers on Friday were shares of Burberry, which jumped 12% after the company reported a shallower-than-expected dip in sales in the fiscal third quarter. Other luxury stocks including Moncler, Swatch and Christian Dior were also trading higher.
Overnight in Asia, stocks climbed higher after the S&P 500 hit a record high in Thursday’s trading session in the U.S. as President Donald Trump called for lower interest rates and cheaper oil prices.
Speaking via video to an assembly of global leaders at the World Economic Forum in Davos, Switzerland, the new president in a wide-ranging policy speech did not mention the Federal Reserve by name but made clear he would seek lower rates.
“I’ll demand that interest rates drop immediately,” Trump said. “And likewise, they should be dropping all over the world. Interest rates should follow us all over.”
The Bank of Japan raised the policy rate by 25 basis points to 0.5% — the highest since 2008 and in line with economists’ expectations. Following the decision, the Japanese yen weakened marginally to trade at 155.18 against the dollar.
Investors are also likely to be looking ahead to the Fed’s FOMC meeting on Wednesday with no change expected to interest rates. Elsewhere in China, equity markets will be closed from Tuesday for the Lunar New Year holiday.
— CNBC’s Amala Balakrishner contributed to this European markets update.
Burberry shares gain after quarterly report
Shares of Burberry jumped 14% on Friday after the company reported a shallower-than-expected dip in sales in the fiscal third quarter, providing a first glimpse of CEO Joshua Schulman’s efforts to revamp the beleaguered British fashion house.
Comparable sales declined 4% in the three months to December. Analysts had anticipated a 12% decrease in a company-compiled consensus estimate.
Shares were last seen up 14.29% by 8:20 a.m. London time.
Monte dei Paschi di Siena offers to buy rival Mediobanca
Italian lender Banca Monte dei Paschi di Siena has made an offer to buy competitor Mediobanca in a 13.3 billion euro ($13.9 billion) deal.
Monte dei Paschi di Siena (MPS), considered the world’s oldest continuously running bank, said it was valuing its rival at 15.992 euros per share, and hopes to complete the offer by the third quarter of this year.
In the offer, MPS said it would find 700 million euros in pre-tax savings. It also highlighted the multi-billion tax losses from previous years the new combined entity will be using to minimize its tax bills.
“The new Group will indeed be able to accelerate the usage of Euro 2.9 billion [deffered tax allowance] over the next six years, or c. Euro 0.5 billion per year, generating a material benefit capital wise,” MPS said in a statement.
MPS is also expecting to see one-time costs of 600 million euros to integrate the two entities if Mediobanca shareholders accept the offer.
The offer would be the third active deal currently in progress in the Italian financial sector, which includes UniCredit‘s offer to buy Banco BPM and Banco BPM’s offer to buy fund manager Anima Holding.
— Ganesh Rao
