EUROPE MARKETS: European Stocks Head For Seven-day Winning Streak

By Sara Sjolin, MarketWatch

LONDON (MarketWatch) -- Upbeat growth data from China and a strong prior-day session on Wall Street helped lift European stock markets on Friday, with the benchmark index on track for a seventh straight day in positive territory.

The Stoxx Europe 600 index climbed 0.5% to 317.69, flirting with the highest level in more than five years.

Shares of L'Oréal SA gained 2.8% after Shiseido Co. said it has entered exclusive talks to sell two of its Paris-based cosmetics businesses to the bigger French rival.

Shares of Anglo American PLC fell 1.4% after the miner released a mixed production update for the third quarter with copper, diamond and nickel output up, but iron ore down.

OMV AG dropped 1.9% after the oil refiner said political unrest in North Africa took its toll on hydrocarbon-production levels in the third quarter.

For the broader European markets, investors were inspired by news from China, where data showed economic growth picked up 7.8% in the third quarter. The reading was higher than some analyst estimates, but in line with average expectations from a Reuters survey of economists.

However, more-recent statistics for September suggest a mild slowdown is under way, with growth for industrial production, retail sales and construction activity all slipping. "While one should always be a bit skeptical about Chinese growth data, the current picture is supported by a rise in industrial production as well as development in electricity production. Interestingly, the current activity data are stronger than the PMIs suggest," analysts at Danske Bank said in a note.

"This is not the first time this has happened, though, and it may indicate some upside risk to PMI in coming months. We look for growth to keep a robust pace in coming quarters but to lose steam during 2014," they added.

Analysts at Nomura were more bearish on the Chinese growth story and said they expect GDP growth to slow to 7.5% year-on-year in the fourth quarter and 6.9% in 2014.

In the U.S., the S&P 500 index (SPX) managed a record finish on Thursday as Wall Street turned from the latest fiscal drama on Capitol Hill to corporate earnings.

U.S. stock futures pointed to a higher open on Friday.

In Europe, Germany's DAX 30 index added 0.2% to 8,832.39. France's CAC 40 index picked up 0.7% to 4,268.66, while the U.K.'s FTSE 100 index rose 0.5% to 6,607.15.

Outside the major indexes, shares of Svenska Cellulosa AB jumped 5.4% after the paper and hygiene-products producer reported a rise in third-quarter profits and beat expectations.

Yara International ASA added 2.7% after the Norwegian firm said fertilizer deliveries were up 17% in the third quarter due to higher sales in Brazil.

Schindler Holding Ltd. climbed 4.8% after announcing a share buyback program.

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