Europe close: Stocks jump heading into the weekend

Investors across the Continent pushed stocks higher amid a certain amount of hope as the G20 leaders' summit in Osaka, Japan, got underway, with the Presidents of the US and China set to meet the following day on the sidelines of the gathering.

Echoing those hopes, IG's Josh Mahony said:"it is worth noting that Trump’s relationship with Xi Jinping has typically been respectful and there is a good chance that once the meeting takes place, we could at least see an outcome which puts negotiations firmly back on the table."

Nevertheless, as strategists at Bank of America-Merrill Lynch pointed out, it would be exaggerated to talk of optimism.

"Consensus expects can-kicking, but no rolling back of tariffs that are already in place. With above-trend economic growth and the S&P 500 at an all-time high, there is no sense of urgency on the part of the US to reach an agreement," BofA-ML said in a research note sent to clients.

"Under a "real deal", the S&P 500 could rally as high as 3100 (more below). But if additional tariffs are implemented, the S&P 500 could sustain a 5%+ move lower."

By the end of trading, the benchmark Stoxx 600 was ahead by 0.70% at 384.87, alongside a rise of 1.04% to 12,398.80 for the German Dax and an advance of 0.59% to 21,234.79 on the FTSE Mibtel.

On the economic side of things meanwhile, according to Eurostat consumer prices in the euro area advanced at a year-on-year pace of 1.2% in June, which was unchanged from the month before, as expected.

At the core level however, prices gains accelerated from 0.8% in May to 1.1% (consensus: 1.0%).

In parallel, Spain's statistics office reported that retail sales in the country rose at a year-on-year pace of 2.4% in May following a rise of 1.3% in the month before.