By Sarah Turner
LONDON (MarketWatch) -- European shares extended a rally from the previous session on Thursday, with banks sharply higher for the second straight session. Royal Bank of Scotland (UK:RBS 44.65, +1.82, +4.25%) shares jumped 6.3% and Credit Agricole (FR:ACA 9.26, +0.11, +1.21%) shares were up 2.8%. Credit Suisse upgraded the sector to market weight from underweight on Thursday, in part as it believes macro factors are now less of a headwind for the sector. Late Wednesday, it was announced that 91 European banks will be stress tested. The European Central Bank and the Bank of England will announce rate decisions on Thursday. The U.K. FTSE 100 index rose 1.1% to 5,070.20, the German DAX index rose 0.5% to 6,020.72 and the French CAC-40 index climbed 0.9% to 3,513.58.
