European Stocks Open Higher Driven by Financial Sector Gains

European stocks opened higher on Friday, supported by gains in financial stocks, despite the main index being set for a weekly decline after investors scaled back their expectations for interest rate cuts following remarks from policymakers. By 08:18 GMT, the Stoxx 600 index was up 0.4%, continuing the gains made in the previous session. Most major sector indices declined, with Eurozone bank stocks rising 0.6%, bolstered by a nearly three percent jump in KBC Group after Morgan Stanley upgraded the rating of the integrated Belgian banking and insurance group. However, comments leaning towards monetary tightening from European Central Bank policymakers led traders to reduce their bets on interest rate cuts, putting the benchmark index on track for a weekly loss. In terms of data, German producer prices fell more than expected in December, dropping 8.6% year-on-year, despite the DAX 40 leading index climbing 0.4%. Among the stocks that drove the rise, Teleperformance shares surged 4.7% after Stifel Financial raised its rating on the telecommunications services company.