European Stocks Rebound as Oil Prices Ease, Middle East Tensions Linger

European stocks ended their three-week losing streak on Friday as oil prices retreated, although investors remained cautious about ongoing tensions in the Middle East and rising bond yields.

The pan-European Stoxx 600 index closed 0.4% higher on Friday, adding to its 0.5% advance for the week, marking its largest weekly gain since early August.

Despite oil prices falling as truce hopes outweighed Houthi attacks on Saudi Arabia, energy shares still fell by 1.3%, with airline stocks being the biggest sectoral losers.

In contrast, heavyweight banks were among the top gainers, rising by 1.3% as UBS led gains after a report revived discussions about its potential exit from Switzerland.