Euro zone economic growth has accelerated to a 10-month high in March, according to the latest S&P composite Purchasing Managers’ Index.

There were also signs of inflation easing, jobs growth accelerating and business confidence holding up, the survey found.

However, growth was driven by services, and manufacturing saw a decline in new orders, with output maintained due to backlogs.

A similar trend was seen in the U.K., where services activity increased for the second consecutive month but manufacturing production decreased. Input price inflation was at a two-year low and employment was stable.

— Jenni Reid

European stocks fell in early Friday trade, with the Stoxx 600 index falling 1.2%.

The U.K.’s FTSE 100, France’s CAC 40 and Germany’s DAX were all down by around 1.4%.

Among sectors, banks plunged 3.2% as a sharp rise in default insurance costs at Deutsche Bank spooked investors and concerns about the stability of the sector returned.

The German bank was down 9% at 9:50 CET.

A monthly consumer confidence survey from GfK showed U.K. households became more optimistic in February, with improvements in five measures that it records, including views of future financial situations, the ability to fund major purchases and the broader economic picture.

“The headline consumer confidence score is still severely depressed and the mood as well as the economy remain a long way off pre-lockdown levels, but a little consumer resilience might be what we need to soften any downturn in 2023,” Joe Staton, client strategy director at GfK, said in the release.

The slight recovery benefited retailers in February, said Gabriella Dickens, senior U.K. economist at Pantheon Macroeconomics, in a note.

U.K. retail sales rose by 1.2% on the month in February, according to national figures also published Friday. The print came in above a consensus expectation of 0.2% and surpassed the 0.9% rise of January.

February retail sales were nevertheless down 3.5% year-on-year. The figure for the three months leading to February was also down 0.3% on the previous three months.

The outlook for retail is mixed, Dickens said, with households avoiding a 1% hit to disposable income because of the ongoing government-funded energy bill cap and suspension of an increase in fuel taxes, as well as rises in the state pension and living wage.

But they will still be affected by other tax measures and by the withdrawal of the energy bill grant program. Figures from the Insolvency Service show an uptick in redundancies in the coming months, while higher mortgage rates will begin to squeeze, Dickens added.

— Jenni Reid

European stock markets were on track to open lower on Friday, according to data from ig.com.

The FTSE 100 was down 49 points to 7,451. France’s CAC 40 was down 48 points to 7,086, Germany’s DAX down 72 points to 15,137, and Italy’s MIB down 155 points to 25,792.

— Jenni Reid

Wall Street is downgrading European banks after stresses in the sector led to the emergency merger of two large Swiss banks.

Two investments also upgraded another sector and named a dozen stocks to own “in case markets turn sour”.

CNBC Pro subscribers can read more here.

— Ganesh Rao

Some investors are tiptoeing back into bank stocks after last week’s selloff, but fund manager Ian Mortimer is steering clear.

In fact, he has never owned a bank stock in any of his funds. He reveals why on CNBC Pro Talks.

Pro subscribers can read more here.

Treasury Secretary Janet Yellen said Thursday that the federal emergency actions used to backstop Silicon Valley Bank and Signature Bank customers could be used again if necessary.

“We have used important tools to act quickly to prevent contagion. And they are tools we could use again,” Yellen said in written testimony before a House Appropriations subcommittee.

“The strong actions we have taken ensure that Americans’ deposits are safe,” she added. “Certainly, we would be prepared to take additional actions if warranted.”

Her comments come as regulators have aimed to reassure customers and investors amid the banking crisis that was promoted by Silicon Valley Bank’s closure.

— Alex Harring, Christina Wilkie