Europe close: Equities end the week on upbeat note as CPI holds steady

European stocks rose on Friday, taking their cue from upbeat sessions in the US and Asia as investors were buoyed by the prospect of continued easing policies from the major central banks.

The benchmark Stoxx Europe 600 index closed up 0.6%, while Germany’s DAX rose 0.39% and France’s CAC 40 finished 0.59% higher.

As of 1634 BST, the euro was on the front foot against the yen and the pound, gaining 0.34% and 0.12% respectively but declined 0.10% against the dollar, while Brent crude reversed earlier gains to decline 0.40% to $49.53 a barrel.

"In a week that saw US, Eurozone and UK CPI all within negative territory there is good reason to believe that we remain within an expansionary phase of monetary policy," said Joshua Mahony, market analyst at IG.

"Driven primarily by the second wave of the ECB, BoJ and PBoC, the overall monetary policy outlook remains bullish for stocks as long as rate hikes continue to be pushed back."

Eurozone inflation remains steady in September

Data released earlier on Friday showed inflation in the Eurozone remained largely stable in September.

According to the Eurostat, the Eurozone consumer price index grew 0.2% month-on-month in September, in line with analysts’ expectations and compared with a flat reading in August.

On a year-on-year basis, the index declined 0.1% compared with a 0.1% drop in August and in line with consensus.

When excluding volatile items such as energy and foods, the core CPI rose 0.9% year-on-year in September, matching the previous month's rate of growth and falling in line with analysts expectations.

“With the Eurozone-wide figure expected at -0.1%, the region’s indices could see a return of the market-lifting hopes that always seem to creep in whenever any data suggests that Mario Draghi might need to dip into his ECB QE coffers for a bit of extra stimulus,” said Connor Campbell, an analyst at Spreadex.

Across the Atlantic, the University of Michigan's consumer sentiment index beat expectations in October. The index fell to a preliminary reading of 92.1 from 87.2 in September, compared with analysts' expectations for a 89.0 reading.

Meanwhile, according to figures released by the Federal Reserve, industrial output in the US fell 0.2% month-on-month in September from an upwardly revised 0.1% decline in the previous month and compared with analysts' expectations for a 0.3% drop.

Mixed earnings among European corporates

In company news, French retailer Carrefour rallied 6.60% after posting a jump in third-quarter revenue thanks to growth in key European markets.

Remy Cointreau slid 2.44%, even though the French drinks maker's second-quarter organic sales came in better than expected.

Vodafone edged 1.29% higher after striking an agreement to extend its strategic partnership with Russian mobile group MTS and expand its scope in Ukraine.

Going the other way, Swiss food company Nestle fell 1.93% after downgrading its full year outlook, while German fashion company Hugo Boss tumbled 4.08% after cutting its full-year profit forecast on the back of weaker China sales.