(Bloomberg) -- European stocks posted their biggest weekly gain since January after a slew of better-than-expected earnings reports and as confidence grows that rate cuts are still possible this year.

The Stoxx Europe 600 index was up 0.8% by the close in London — scaling yet another record and taking its weekly advance to 3%. Most industry sectors were trading higher, with retail, construction, and utilities topping the leaderboard. Chemicals, real estate and autos lagged. 

The regional benchmark is on a record-hitting spree amid a surprisingly strong earnings season, with almost half of the companies that have reported so far beating expectations. Signs of a cooling US labor market, meanwhile, are fueling optimism about possible Federal Reserve easing this year.

The UK’s FTSE 100, France’s CAC 40 and Germany’s DAX also scaled record peak. The UK’s run higher comes as data showed the economy bounced back strongly from a shallow recession at the end of last year. 

“The environment is fundamentally favorable for risky investments, equities, corporate bonds and commodities,” said Ulrich Urbahn, head of multi-asset strategy and research at Berenberg. “However, the equity markets are already pricing in a lot of optimism.”

Urbahn said he sees opportunities “beneath the surface,” including strategies that favor investing in Europe over the US.

Meanwhile, blue-chip Euro Stoxx 50 index made a fresh high since November 2000. The benchmark has risen 12.4% this year, beating many of its global peers.

For more on equity markets:

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  • London IPOs Stand to Gain From Savings Plan for Brits: ECM Watch
  • US Stock Futures Little Changed; Natera, Adma Biologics Gain
  • Cutting the chord: The London Rush

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--With assistance from Michael Msika.

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