Banks shine as European stock market rally resumes

European shares resumed their rally on Friday as a bumper stimulus from the European Central Bank fuelled hopes of a faster economic recovery, putting the main benchmarks on course for their best week in two months.

The pan-European STOXX 600 gained 1.2% by 0722 GMT, led by a 3% jump in bank stocks. Insurers, automakers and travel stocks also rose more than 2%. Global equity markets have climbed strongly this week, with Wall Street indexes nearing record levels as investors focussed on re-opening of economies.

The STOXX 600 is about 15% below all-time highs, but has recovered more than 37% from March lows as fresh stimulus plans for Europe spurred a move into economically sensitive cyclical sectors. British Airways owner-IAG and easyJet jumped nearly 9%, topping gains on the STOXX 600.