The pan-European STOXX 600 index <.STOXX> ended the session up 0.3 percent with almost all major regional indexes higher.

Reversing steep losses from early in the year, mining stocks helped Europe's basic resources index <.SXPP> to a 61.9-percent gain this year, bouncing back from a 35-percent slump in 2015.

The bounce in miners also helped Britain's FTSE 100 to gain 14.4 percent in 2016, making it the best performer among major European stock indexes despite the shock of June's Brexit vote.

The index, dominated by global firms, has been boosted by a sharp drop in sterling after the referendum and the resilience of the economy.

"The latest GDP figures point to a strong UK economy which has probably accounted for some of the pick-up in equity prices overall since the referendum," KPMG UK's head of macroeconomics, Yael Selfin, said.

The second half of the year also saw a sharp rebound in banking stocks as an improving global economic outlook, a rising U.S. interest rate environment and expectations of a lower level of regulation in the United States after Donald Trump's presidential election win prompted investors to buy cyclicals.

The European banking index <.SX7P> rose 12 percent in the third quarter and has surged 21.5 percent so far in the fourth quarter, after sinking 20 percent in the January-March period of 2016 and falling 13 percent in the second quarter.

The banking index, which fell about 35 percent in the first half to become the worst sectoral performer, is now down just 6.8 percent for the year. Telecoms <.SXKP> have now fallen to the bottom of the list, falling 15.8 percent this year.

Across Europe, the STOXX Europe 600 index is down 1.2 percent this year, reflecting political uncertainties in the region and concerns about the Italian banking industry.

Italy's benchmark FTSE MIB <.FTMIB> is down about 10 percent, among the worst performers in Europe, following a 38- percent slump in the bank sector <.FTIT8300> this year.

Germany's DAX <.GDAXI> has risen 6.9 percent in 2016, while France's CAC <.FCHI> is up 4.9 percent. However, Spain's IBEX <.IBEX> has fallen 2 percent.

On Friday, the STOXX 600, the FTSE 100, the DAX, the CAC and the IBEX ended down between 0.3 percent and 0.5 percent.

(Editing by Louise Ireland)

By Kit Rees and Atul Prakash