European stocks ending the session up 2.6% on Thursday – their best rally in three months.

Investors reacted positively to a solid outlook from Nokia. The mobile phone maker’s shares rose nearly 8%.

Financial stocks enjoyed a second straight day of gains as concerns about the credit crisis eased in response to better than expected results from the third largest US bank JPMorgan Chase.

However, analysts remained cautious and said they are uncertain whether this rally marks a significant turnaround.

Oil prices are creeping back up as investors resumed buying after the recent sharp drop.

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