Friday, Dec 23, 2011

--Europe stocks log gains ahead of holidays

--Oil prices gain, lifting shares of BP, Total

--Stoxx 600 gains 3% on week but is off 12% year to date

By Barbara Kollmeyer

MADRID (Dow Jones)--European stocks closed higher in holiday-thinned trading Friday, helped by energy stocks such as BP PLC and drug shares like Roche Holding AG.

Markets in London closed early and European markets are closed next Monday for the Christmas holiday.

The Stoxx Europe 600 index rose 0.87% to 241.83, after closing up 1% in the prior session.

The index ended the week up more than 3%, but on a year-to-date basis, it has lost over 12%.

Shares of heavily-weighted Roche rose 1% after its ovarian-cancer drug, Avastin, won European Union clearance for treatment of women with a newly diagnosed advanced case of the disease.

U.S. stock markets traded higher after a mixed bag of data, including lackluster consumer spending and personal incomes, stronger-than-expected durable-goods orders and a sharp gain for new home sales in November.

Still, some pointed to the lack of rising incomes in the U.S. as a factor that could harm any budding recovery.

"The personal income and spending data weren't that good, and it's a big danger for next year," said Koen De Leus, strategist at KBC Securities. "People say the macro data are in good shape (from the U.S.) but you really have to take care with these two components."

Light trading helped draw attention away from sovereign-debt issues on Friday, but De Leus noted that bond yields are creeping higher.

Stock markets were largely lifted this week after a strong take-up of three-year loans by the European Central Bank, with some of that money expected to be directed toward buying of sovereign debt.

But De Leus said it didn't appear to be working quite yet.

Italian 10-year government bond yields traded higher to around the 7% level from 6.79% late the prior day.

The FTSE Italy MIB index rose just 0.31% to 15,073.99, with banks UniCredit SpA and Unione di Banche Italiane SCpA down 3% and 2%, respectively. Banks across Europe made strong gains the prior session.

Italy's Senate gave final approval to a $40 billion emergency austerity and growth package on Thursday following a lengthy debate, according to media reports. Prime Minister Mario Monti had called for a confidence vote on the measures.

Oil stocks lead gains

Crude oil continued to edge nearer the $100-a-barrel mark, lifting energy stocks like BP, which closed up 2% in London and Total SA, up 2% in Paris.

Gains for BP lifted the FTSE 100 index to close up 1% to 5,512.70, ending the week 2.3% higher. Shares of Tullow Oil PLC rose 3% and several utilities also helped out, with National Grid PLC adding 2.5% and Centrica PLC gaining 1.9%.

Total's gains boosted the French CAC 1% to 3,102.09. Utilities also rose in Paris, with Veolia Environnement SA up 3.6%. Luxury goods group LVMH Moet Hennessy Louis Vuitton SA rose 1.6%, continuing strong gains from the prior session.

The French index gained over 4% for the week.

Less stellar gains were seen in Frankfurt, where the German DAX 30 index rose 0.46% to 5,878.93, led by a 1.7% rise for Deutsche Bank AG. But shares of Commerzbank AG led decliners with a 0.7% drop, following sharp gains the prior day.

Auto group Volkswagen AG was up 0.4% and BMW AG fell 0.5%.

The German index closed the week up 3.1%.

-By Barbara Kollmeyer, barbara.kollmeyer@dowjones.com

(END) Dow Jones Newswires

December 23, 2011 12:48 ET (17:48 GMT)