EUROPE MARKETS: U.K. Stocks Lead Europe Higher On Quiet May Day

By Sara Sjolin, MarketWatch

LONDON (MarketWatch) -- With most markets closed for May Day, Europe's benchmark stock index inched higher Thursday, supported by well-received earnings reports from U.K. majors Lloyds Banking Group and BSkyB.

The Stoxx Europe 600 index rose 0.2% to 338.50, recovering from a loss of the same amount on Wednesday. The majority of the region's stock markets closed to observe the May Day holiday, including markets in France, Germany, Italy and Spain.

It was business as usual in the U.K., where the FTSE 100 index gained 0.4% to 6,808.87, posting its highest close in almost two months.

Shares of Lloyds Banking Group PLC (LYG) buoyed the index with their climb of 5.5%. The bank said first-quarter adjusted profit rose 22% as bad loans declined in an improving U.K. economy. Read: Best stocks to play a thriving U.K. economy

British Sky Broadcasting Group PLC jumped 2.3% after the cable-TV provider said demand for new products pushed up revenue in the nine months ended March 31.

Meanwhile, the pound (GBPUSD) climbed against the U.S. dollar after the Markit/CIPS manufacturing PMI for the U.K. beat expectations in April, rising to a five-month high of 57.3. The pound bought $1.6900, and traded as high as $1.6921, up from $1.6871 late Wednesday.

Also, U.K. lender Nationwide said its monthly house-price index rose to its highest level in six-and-a-half years, and prices are now close to their previous peak.

The OMX Copenhagen 20 index fell 0.3%, feeling the weight of a 1.9% decline in heavyweight Novo Nordisk AS shares (NVO). The world's largest insulin maker reported a rise in first-quarter earnings, but cut its sales guidance for the full year.

Also in Copenhagen, shares of Danske Bank AS advanced 1.6% after the bank said profit in the first quarter almost doubled.

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