By Shashwat Chauhan
(Reuters) -European shares advanced in broad-based gains on Friday as easing government bond yields and positive economic data from China boosted sentiment, keeping the STOXX 600 on track for its fourth straight weekly rise.
The pan-European STOXX 600 was up 0.7% as of 0930 GMT, on track for a more than 2% jump for the week and less than 1% away from record highs.
Most STOXX sub-sectors were trading higher, with automobiles up 1.8%, while construction and materials added 1.6%.
Yields across European government bonds eased, with the yield on the 10-year bund last at 2.5%, down for the third straight day.
Risk sentiment got a boost after China's economy matched the government's ambitions for 5% growth last year, but in a lopsided fashion.
UK's FTSE 100 outperformed its continental peers, gaining 1% to hit an all-time high.
British retail sales fell unexpectedly in December, adding to a run of downbeat economic indicators that are likely to further boost expectations for a Bank of England interest rate cut next month.
European equities advanced this week as global markets reacted to easing U.S. core inflation which kept potential rate cuts by the Federal Reserve on the table.
Positive earnings from Cartier-owner Richemont (SIX:CFR) on Thursday spurred a rally amongst luxury heavyweights such as LVMH, Kering (EPA:PRTP) and Swatch, giving a leg up to the broader index this week.
In the session, the final reading of euro zone inflation for December due at 1000 GMT would be in focus.
Next (LON:NXT) Monday, Donald Trump's inauguration as U.S. president would be in the spotlight with investors on the lookout for new policies including possible trade tariffs.
"Is there an expectation that Trump will put in place tariffs? Yes, there is. Exactly what that involves, it's hard to say," said Ben Ritchie, head of developed market equities at abrdn.
"I suspect a light form of tariff implementation is priced into the market, but I don't think it's pricing in a more draconian scenario, like universal tariffs at very high levels."
Glencore (LON:GLEN) gained 2.6%, while Rio Tinto (LON:RIO)'s London-listed shares were up 1.4%. Glencore approached Rio Tinto late last year about combining the two big copper producers but the discussions are no longer active, Reuters reported.
Avolta jumped 7.7% after the Swiss duty-free retailer said it plans to buy back shares for the equivalent of 200 million Swiss francs ($219.56 million) for cancelling them in the future.
($1 = 0.9109 Swiss francs)