European stocks end 2.9 pct higher on bailout hopes
PARIS, Oct 3 (Reuters) - European stocks gained 2.9 percent on Friday, tracking a sharp rally on Wall Street on hopes over the vote of the U.S. House of Representatives on the rescue plan for the embattled financial sector.
The FTSEurofirst 300 .FTEU3 index of top European shares unofficially closed 2.9 percent higher at 1,088.65 points. On the week, the benchmark index lost 1.5 percent.
Recently-hammered banks surged, with BNP Paribas (BNPP.PA) gaining 11 percent, Barclays (BARC.L) rising 8.6 percent and Credit Suisse (CSGN.VX) adding 8.3 percent.
The sector was also buoyed by news that Wells Fargo (WFC.N) agreed to buy embattled bank Wachovia Corp WB.N, fuelling hopes of more consolidation among banks.
The House of Representatives, which shocked the markets worldwide on Monday by rejecting a first version of the plan, is expected to vote on the package around 1600 GMT. The plan would help purge banks' balance sheets from bad mortgage-related debt and unclog the credit market.
Hopes surrounding the plan eclipsed bleak U.S. jobs data that showed U.S. employers cut an unexpectedly large 159,000 jobs in August.
"Let's assume the bill passes, and it's obviously a big 'if', we think that the stock market will start focusing much more on the economic doldrums and the focus will be less on the financials," said Franz Wenzel, strategist at AXA Investment Managers, in Paris.
"The economic picture doesn't look bright, and stocks will probably continue their rollercoaster ride on the day to day news flow, but underneath the surface, we will see a shift in sectors, with less downbeat sentiment on the financials." (Reporting by Blaise Robinson)
