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European stocks climbed early on Friday, with French information technology services firm Atos SE leading a rally in tech shares after unveiling a deal to buy Xerox Corp's IT outsourcing arm.
Atos, set to pay $1.05 billion for the unit, said the deal was expected to boost its earnings per share by 10 per cent as early as the first year.
"The deal makes a lot of strategic sense for Atos. The implied acquisition multiple is of 8.75 times expected earnings (and) reflects a fair price, given similar deals in the United States," a Paris-based trader said.
Shares in Atos surged 7.2 per cent, leading gains in the STOXX Europe 600 Technology sector, which was up 1.1 per cent at 0830 GMT.
The FTSEurofirst 300 index of top European shares was up 0.6 per cent at 1,364.23 points, adding to a three per cent rally on Thursday.
The gains in Europe mirrored a surge on Wall Street on Thursday where the Dow posted its best one-day rise in three years and extended a rally sparked by the US Federal Reserve's commitment to take a "patient" approach towards raising interest rates.
The market's gains came even as oil prices stayed under pressure, suggesting equity investors were beginning to see the positives in lower fuel costs and increased consumer spending power.
"The drop in oil price has recently put pressure on the equity market. However, (there is) historical evidence that a fall in oil price is a positive for equities, with a clear acceleration in performance after six months," Roland Kaloyan, head of European equity strategy at Societe Generale, wrote in a note.
Air France-KLM bucked the trend, tumbling 7.5 per cent after the airline issued its third profit warning in six months, cutting its 2014 earnings goal by €200 million as higher-than-expected costs from a recent pilot strike added to weaker unit revenues.
Also losing ground on Friday, shares in oil and gas companies fell again as oil prices dipped. Seadrill fell 9.4 per cent, Afren was down 6.1 per cent and Technip up 2.6 per cent.
Around Europe, UK's FTSE 100 index was up 0.7 per cent, Germany's DAX index up 0.6 per cent, and France's CAC 40 up 0.7 per cent.
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