Europe open: Shares up on US debt ceiling talks optimism

European shares opened higher on Friday on optimism that an agreement would be reached in the talks on the US debt ceiling.

The pan-regional Stoxx 600 index was up 0.4% in early deals with all major bourses higher. Germany’s DAX rose 0.3% and was nearing its all-time high of 16,290.19, hit in November 2021.

US President Joe Biden and congressional Republican leader Kevin McCarthy said they are determined to strike a deal soon to raise the government's $31.4 trln borrowing limit.

The Wall Street's S&P 500 and Nasdaq notched their strongest close in over eight months on Thursday, driven by mounting optimism that a U.S. debt ceiling deal could be reached within days.

Data showed German producer prices rose slightly more than expected to 4.1% in April, on a year-on-year basis, likely keeping the European Central Bank on course for more interest rate hikes.

Federal Reserve Chair Jerome Powell and ECB President Christine Lagarde are scheduled to speak at separate panel discussions later in the day.

In equity news, Smiths Group shares gained as the industrial technology company lifted revenue guidance after a strong third quarter, driven by volume and price growth. Organic revenue was up 13.4% for the nine months to April 30, leading Smiths to increase 2023 guidance to around 10% organic revenue growth with "moderate" margin improvement.

Reporting by Frank Prenesti for Sharecast.com