European Shares Close Higher On Banks, Insurers

Banking stocks gained, with UBS, Deutsche Bank, BNP Paribas and Societe Generale all up between 9.4 and 16.2 percent.

European shares closed higher on Thursday, ending a four-day losing streak, as Royal Bank of Scotland led a resurgent banking sector, while investors reacted positively to U.S. housing data.

The FTSEurofirst 300 index of top European shares provisionally closed 2 percent higher at 730.58 points, after hitting a six-year low on Wednesday. It has fallen more than 12 percent so far this year after plummeting 45 percent last year.

RBS jumped 26.8 percent after the company said it would put 325 billion pounds ($463 billion) of its assets into Britain's bank insurance scheme as it reported the biggest loss in British history.

"For me, this is the frail attempt of a bear market rally. It may not be sustainable enough, but if the markets go into the weekend on a positive note, I could imagine that gains will continue next week," said Giuseppe-Guido Amato, strategist at Lang & Schwarz in Germany.

Banking stocks gained, with UBS, Deutsche Bank, BNP Paribas and Societe Generale all up between 9.4 and 16.2 percent.