European stocks rebounded sharply on Friday, supported by auto manufacturers, luxury brands and heavyweight banks after losses in the previous session. The Euro STOXX 50 gained 1% to 6,492, while the STOXX Europe 600 rose 0.6% to 655, with both indexes reaching their highest levels in nearly two weeks. Volkswagen, Mercedes-Benz and BMW climbed between 4% and 3% as investors continued assessing their exposure to US tariffs on Mexico and Canada, alongside the benefits of higher industrial profits in China. Strong Chinese economic data also lifted LVMH, Hermes and Ferrari, each of which gained more than 2%. European banks advanced after Fed Chairman Warsh adopted a more hawkish tone than in previous communications, flattening global yield curves, which track interest rates across maturities. BNP Paribas rose 2%, while UniCredit and BBVA gained 1.5%. Higher inflation readings in France and Spain consolidated expectations of an ECB rate hike.