European shares make biggest weekly gain in six months

European shares edged up on Friday, and recorded their biggest weekly gain in six months, with investors increasingly confident Japan's nuclear crisis and Middle East unrest would not derail global growth. The pan-European FTSEurofirst 300 index of top shares rose 0.1 percent to 1,124.65 points, the highest close since March 10.
Volumes were 77.5 percent of the 90-day average. Over the week, the index rose 3.3 percent, the biggest gain since September, and has regained almost half the ground lost in the fall between a February high and a March low. Drugmakers were among the gainers, with investors lured by cheap valuations. The sector is still down more than 4 percent in the year to date, compared with a 0.3 percent gain for the pan-European benchmark.
Heavyweights GlaxoSm-ithKline, AstraZeneca and Sanofi-Aventis rose between 0.9 and 1.2 percent. News that the US economy is growing more quickly than previously estimated also helped shares. Stock markets world-wide have benefited from monetary stimulus. But some strategists say some momentum might be lost in the run-up to the end of the Federal Reserve's second round of quantitative easing in June.
Across Europe, Britain's FTSE 100, Germany's DAX and France's CAC40 rose between 0.1 and 0.3 percent. Portugal's benchmark and Spain's IBEX fell 0.2 and 0.4 percent, respectively. BP recovered from earlier falls to close 0.6 percent higher. Russia's Rosneft vowed to push ahead with a strategic alliance with BP, despite a block on the deal by the British oil company's partners in joint venture TNK-BP.
On the downside, Autonomy slipped 3.4 percent after J.P. Morgan downgraded the software firm's 2012 earnings estimates. Thomson Reuters Datastream figures showed the STOXX Europe 600 index priced at 10.2 times forecast earnings, below a 10-year average of 13.6, while the S&P 500 has a one-year forward price-earnings ratio of 12.5 times.