Europe midday: Stocks in the black as oil rallies

European stocks rose on Friday, rebounding from losses in the previous session as oil prices advanced.

At midday, the benchmark Stoxx 600 index was up 0.8%, while Germany’s DAX and France’s CAC 40 were both 0.9% higher.

At the same time, oil prices were in the black, supported by comments from Federal Reserve Chair Janet Yellen and hopes of an agreement by OPEC and non-OPEC members to cap output at the upcoming meeting in Doha.

West Texas Intermediate was up 3.5% to $38.56 a barrel and Brent crude was up 3.4% to $40.75.

The Stoxx 600 oil and gas index rose 1.6%.

“Relative calm has descended upon European markets, as yesterday’s dash for safety seems to have abated,” said IG analyst Joshua Mahony.

“Crude prices have clearly shifted into a more bullish gear to end out this week, with WTI breaking to a new April high. There will be a clear market repositioning ahead of the OPEC meeting in nine days’ time, yet with continued mixed messages emanating from various sources, directional bias continues to change hands every other day.”

In a speech on Thursday, Yellen – appearing on a panel at New York’s International House with her predecessors Ben Bernanke, Paul Volcker and Alan Greenspan – assuaged concerns about a recession.

Yellen said the central bank’s decision to hike rates in December was not a mistake, adding that the US economy had made good progress since the financial crisis.

"The US economy has continued to progress in a satisfactory way. We continue to see good job performance, some evidence of inflation moving up, so that was our expectation when we raised rates in December," Yellen said.

German data helped lift the mood. Destatis said exports rose 1.3% month-on-month in February following a 0.6% decline in January and better than economists’ expectations of a 0.5% increase.

In corporate news, Associated British Foods was a touch higher after agreeing to acquire the remaining stake in South African sugar producer Illovo Sugar it did not already own.

Air France-KLM flew higher after reporting a 4.6% jump in March passenger traffic.

FTSE 250 company Tullow Oil was on the back foot after it confirmed damage to the turret bearing on a floating production storage and offloading (FPSO) unit at its Jubilee field in Ghana, but said this was unlikely to have a material impact on revenue.

AstraZeneca nudged lower after saying that it and Eli Lilly have decided to continue a pivotal clinical trial for a potential treatment for early Alzheimer’s disease.