The buyers returned to Frankfurt, turning two days of broad slippage into steady gains with tech stocks providing most of the momentum. The euro stayed under pressure in the foreign exchange markets in spite of the widely anticipated 25 basis point rise for European interest rates. As a result, financials had a mixed session.

But Wall Street opened in bullish mood and most sectors drove higher from mid-morning. Technology leaders tracked the opening gains for the Nasdaq. Siemens gained €4.80 to €181.15 and Epcos €7.59 or 7 per cent at €116.39. SAP rose €16.55 to €288.20.

Paris slipped marginally in late trading after a topsy-turvey day that pivoted on the ECB's announcement of a 25 basis point increase in euro zone interest rates. In the end though, 4 per cent falls in heavyweight stocks Axa and Peugeot to €160.3 and €207.9 respectively held the market back.

Total Fina Elf was also a drag, falling €6.5 to €167.1 after government threats to pass on to oil companies the cost of domestic fuel tax cuts. However, the market was held up by a rousing performance from Carrefour, which climbed more than 6 per cent to €82.10.

Amsterdam pushed higher thanks to a powerful run for cable TV group UPC, which surged 11.8 per cent, and steady gains for Philips. UPC rose €2.90 to €27.51, while Philips gained €1.60 to €54.80 as TMT sectors found themselves back at the top of the investment agenda. The AEX index ended 4.21 higher at 689.52.

Zurich was flat as another sharp fall for CS Group balanced out mostly modest gains in other blue chips. The SMI index finished just 0.1 easier at 8,219.9.

Stockholm was encouraged by the modest ECB rate rise and underpinned by strong gains in Ericsson and Nokia. The general index closed 95.94 or 1.7 per cent higher at 5,885.45.

Milan picked up to close at the session high in response to the ECB's rate decision, with the Mibtel index registering a rise of 374 at 33,007. Among the best performers, publisher and portal owner Seat jumped 5.4 per cent to €3.55.