European Stocks Rise on Oil Drop, Banking Support; Fed Hike Bets Grow

European equities closed higher on Friday, buoyed by falling oil prices and banking sector strength, despite rising market expectations for a Fed rate hike next week following firm August inflation data. The Stoxx 600 gained 0.48%, with the DAX up 0.82% and FTSE 100 up 0.39%. The move reflects a risk-on tone in equities even as rate-hike bets intensify, suggesting markets are pricing in a hawkish Fed without derailing the rally.