European shares rally as Middle East peace hopes drag oil prices lower

European shares rallied with the pan-European STOXX 600 index advancing 1.9% to 633.21 points, logging 1.7% weekly gains, as Middle East peace hopes dragged oil prices lower. Spain's IBEX 35 hit an all-time high climbing over 2.6%, while the banks index led sectoral gains with a 4.3% rise led by Deutsche Bank and Societe Generale, and travel & leisure stocks jumped 4.1%. On the data front, German inflation eased to 2.7% in May while Britain's economy contracted 0.1% in April.