The European markets rose on Wednesday, as banking stocks recovered after U.S. lender Wells Fargo reported a record first quarter profit and mining stocks gained after metals prices climbed.

The U.S. Federal Housing Finance Agency said home prices rose 0.7% in February from the previous month.

Crude for June delivery dropped $0.45 to $48.10 a barrel on the New York Mercantile Exchange, by the time the European markets closed, after the U.S. government reported that petroleum inventories grew more than expected with crude stocks rising to the highest level in nearly 19 years.

The FTSEurofirst 300 index of pan-European blue chips closed 0.85% higher at 794.25 points, while the narrower DJ Stoxx 50 index rose 0.71% to 1,947.13 points.

Around Europe, the U.K.'s FTSE 100 index rose 1.08% to 4,030.66, while France's CAC 40 index surged up 1.72% to 3,025.24 and Germany's DAX index climbed 2.06% to 4,594.42.

Banking stocks regained lost ground after Wells Fargo posted a record first quarter profit of $3.05 billion, thus joining a number of large U.S. banks to have reported better-than-expected profits. Banking stocks slipped earlier in the session on disappointing quarterly results from Morgan Stanley.

UBS, Switzerland's largest bank, climbed 7.3%, while Deutsche Bank, Germany's biggest lender, rose 6.7% and Barclays, Britain's third largest bank, surged up 9.6%.

Commerzbank, Germany's second largest bank, jumped 9.6% after the Financial Times Deutschland reported the Frankfurt- based bank will have to split off commercial-property lender Eurohypo AG to get the European Commission's approval for a government bailout.

Mining stocks gained on firmer gold, aluminum and copper prices. BHP Billiton, the world's biggest miner, rose 2.1%, while Anglo American, the second biggest, surged up 2.9% and Rio Tinto, the third biggest, climbed 7.7%.

Electrolux, the world's second biggest home appliances maker, jumped 16% after the company as reported a smaller-than-expected first quarter loss.

Carphone Warehouse gained 7.1% after the company said it will split its retail and telecommunications units to create two separately listed companies and increase value for shareholders.

On the other hand, Swiss drugmaker Roche slipped 10% after Genentech Inc., the U.S. biotechnology company owned by Roche, said the Avastin cancer drug failed to reduce the risk of tumors returning when given with chemotherapy to patients with early stages of the disease following surgery.

GlaxoSmithKline, Europe's biggest drugmaker, fell 3% after the company reported lower first quarter profit.

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