European stocks rise on Greece hopes

European stocks rose to a seven-year high amid investor speculation that Greece will reach a compromise agreement on its bailout terms with euro-area creditors.

"Greece and the euro zone have to find a good compromise," said Andreas Lipkow, a senior market strategist at Kliegel & Hafner AG in Berlin. "Investors have been underweight European equities, so that's why every weak day in the market is a buying opportunity for investors. QE is the most important theme in Europe right now. That is overshadowing everything."

Greece may request an extension of its loan agreement for six months as soon as today, according to a person familiar with the matter. Such a move would ease a standoff with creditors over its financing. Talks are continuing on the conditions that would be attached to such an extension, the person said.

Greece's ASE Index halted a two-day decline, rising 1.6 percent. National Bank of Greece SA and Piraeus Bank SA led the advance with gains of more than 7 percent.

Among companies moving on corporate news, PSA Peugeot Citroen rose 3.6 percent. The carmaker posted its first annual profit in three years after slashing costs.

Energy stocks and banks were among the biggest gainers out of 19 groups in the Stoxx 600 after Eni SpA and Credit Agricole SA posted results. Eni rose 2.8 percent after Italy's largest oil company posted fourth-quarter operating profit that beat estimates.

Credit Agricole jumped 6.1 percent to its highest price since March 2011. France's third-largest bank reported better-than-forecast fourth-quarter profit on higher earnings at the investment bank and lower provisions for doubtful loans.

Vivendi SA gained 1.1 percent after billionaire Patrick Drahi offered 3.9 billion euros ($4.4 billion) to buy its 20 percent in Numericable-SFR.

Carlsberg A/S sank 3.6 percent after fourth-quarter earnings missed analysts' estimates.

At the moment:

FTSE 100 6,901.02 +2.89 +0.04%

CAC 40 4,799 +45.01 +0.95%

DAX 10,955.74 +60.12 +0.55%