Mediterranean markets were the best performers on a Friday which saw most markets on the European mainland move ahead.

Spain's IBEX 35 climbed 94 points to 8,798 while Milan's MIB index jumped 180 to 15,503. The continent's big beasts, the CAC 40 and the DAX advanced 12 points and 25 points respectively, with the French index closing at 3,087 and the German at 5,670.

Sentiment was lifted by US non-farm payrolls data coming in ahead of expectations, with 103,000 job additons in the month of September, versus expectations of a rise of 55,000.

GREEK EPIC NOT FINISHED YET

Even though the Greek Finance Ministry reported on Thursday night that talks regarding the country's next €8bn tranche of aid have concluded, International Monetary Fund mission chief Poul Thomsen said that despite progress being made, "there are still important issues that need to be discussed."

That put lenders such as Credit Agricole, BNP Paribas and Societe Generale on the back foot in Paris, along with investment bank Natixis, while in Frankfurt Commerzbank and Deutsche Bank fell by a couple of percentage points or more.

Elsewhere in the banking sector, ratings agency Moody's took the knife to its ratings for UK and Portuguese banks. The agency has downgraded its view of the senior debt and deposit ratings of nine Portuguese banks, by one or two notches. All of them carry a negative outlook, except for Banco Portuguese de Negocios (BNP), which has a developing outlook.

The nine companies affected are Caixa Geral de Depositos, Banco Comercial Portugues, Banco Espirito Santo, Espirito Santo Financial Group (ESFG), Banco BPI, Banco Santander Totta, Caixa Economica Montepio Geral, Banco Internacional do Funchal (Banif), and Banco Portugues de Negocios. Banco Espirito Santo, Banco Comercial Portugues, and BPI fared the worst with downgrades of two notches.

Moody's cites increased risk as a result of Portugal's rating downgrade, further deterioration of the banks' domestic asset quality due to a weak economic growth outlook and government austerity measures, and liquidity strains due to a lack access to wholesale funding.

In the UK, 12 lenders got the downgrade treatment. Lloyds TSB, Santander UK and the Co-Operative Bank were downgraded one notch, while building society Nationwide and state-owned bank RBS went down two levels.

Smaller institutions, including Clydesdale Bank were also hit.

BURNING RUBBER

Car makers took a pasting at the start of the week on fears that demand from China would slow down, following signs that Chinese economic growth is running out of petrol, but buyers returned to the sector at the end of the week. The big German names - BMW, Commerzbank and Volkswagen - all motored ahead and, not to be outdone, so did the French representatives, Peugeot and Renault, plus Italy's champion, Fiat.

Tyre maker Continental, meanwhile, has unveiled plans to more in excess of $0.5bn on a new factory in the US state of South Carolina.

DOWN THE PLUG HOLE

On the downside, utility company Veolia Environnement was lower after UBS downgraded the water company to "sell" from "neutral"; Suez Environnement fells in sympathy.

BONDS IN THE SHADE

With the US economy - and, by association, the global economy - in better shape than thought, there was little enthusiasm for the safe but boring charms of government debt.

The benchmark 10-year German bund fell back, pushing the yield up from 1.94% to 2.00% Yields move inversely to bond prices.

Economic data was deemed beneficial to oil prices, however, with the most commonly traded futures contracts for Brent crude and West Texas sweet light crude both climbing 25 cents a barrel, the former to $105.98 and the latter to $82.40.

CAC 40 - Risers
AXA (CS) € 11.04 +5.19%
Total (FP) € 35.19 +2.47%
Peugeot (UG) € 17.43 +2.47%
Publicis Groupe Sa (PUB) € 32.97 +1.65%
Unibail-Rodamco (UL) € 143.25 +1.60%
Saint Gobain (SGO) € 31.88 +1.54%
LVMH (MC) € 106.80 +1.47%
Cap Gemini (CAP) € 26.45 +1.30%
GDF Suez (GSZ) € 23.75 +1.06%
Vinci (DG) € 33.35 +1.05%

CAC 40 - Fallers
Carrefour (CA) € 17.18 -4.07%
Natixis SA (KN) € 2.42 -3.47%
EADS (EAD) € 20.98 -3.34%
Credit Agricole (ACA) € 5.26 -3.20%
Alstom (ALO) € 24.17 -2.93%
BNP Paribas (BNP) € 31.13 -2.79%
Lafarge (LG) € 27.28 -2.27%
Veolia Environnement (VIE) € 10.69 -1.97%
Societe Generale (GLE) € 20.32 -1.79%
Technip (TEC) € 60.00 -0.79%

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