European Markets Rally

European stocks rose in early trade on Friday, resuming their brisk three-week rally as the European Central Bank's decision to raise interest rates helped fuel optimism over the health of euro zone economy.

Investors were also relieved that a strong aftershock which struck Japan's earthquake-ravaged northeast late on Thursday had not done major damage. News of the earthquake had sparked a bout of profit taking in late trading in Europe on Thursday.

At 0705 GMT, the FTSEurofirst 300 index of top European shares was up 0.5 percent at 1,149.74 points.

"The ECB's move is sort of removing the punch bowl, which is a good thing at this point. The message is that overall, the European economy has been improving," a Paris-based trader said.

Mining shares such as Xstrata and Anglo American featured among the top gainers, rising along with buoyant metal prices.