European stock markets are trading sharply higher on Friday, signaling equities will pare their biggest monthly loss since June 2013, amid optimism the Bank of Japan’s stimulus will fill some of the gap left by the end of Federal Reserve bond buying.

Europe's leading Blue-chip index, EURO STOXX 50 went up 46.22 points or 1.52 percent to trade at 3,082.12. While UK's benchmark index FTSE 100 gained 64.57 points or 1 percent to trade at 6,528.12.

Germany's benchmark index DAX gained 140.82 points or 1.54 percent to trade at 9,255.66. Meanwhile, French benchmark index CAC 40 rose 62.35 points or 1.51 percent to trade at 4,203.59.