European markets opened higher following upbeat trade data from China.

Europe's FTSEurofirst 300 rose 0.1% in early trade, as did Britain's FTSE 100 and Germany's DAX.

France's CAC 40, Spain's IBEX and Italy's FTSE MIB rose 0.2%.

In China, stronger-than-expected trade data and last month's upbeat purchasing managers' index (PMI) data have raised hopes that the world's second-largest economy could be stabilising.

On Thursday, Chinese government data showed that exports rose 5.1% in July, compared to a Reuters forecast of a 3% increase. Exports fell 3.1% in June.

The markets were also boosted by Wednesday's Bank of England inflation report, in which BoE Governor Mark Carney averred that the key interest rate will stay at its record low until the UK unemployment rate falls below 7%.

Launching the BoE's quarterly inflation report, Carney also said that the central bank is ready to pump further stimulus into the economy through its £375bn (€433bn, $577bn) asset purchasing quantitative easing programme, which will also be subject to the unemployment guidance level.

In company news, underlying sales at Nestle rose 4.1% in the first half, missing forecasts and prompting the world's largest food group to cut its sales projections.

Germany's second largest lender, Commerzbank, reported a net profit of €43m, short of the average forecast of €65m. Standard Life posted a 6% increase in first half operating profits, while rival asset manager Schroders reported a 29% jump.

Anglo-Australian miner Rio Tinto will also put out its earnings update during the day.

In Asia and the US

In Asia, the Japanese Nikkei finished 1.59% lower. Australia's S&P/ASX closed 1.07% higher, while South Korea's Kospi ended 0.30% higher.

Earlier in Asia, markets bounced back on Thursday morning from the previous day's heavy losses, on positive cues from China, Japan and South Korea.

However, Japanese and mainland Chinese markets retreated in the afternoon session.

Perpetual's head of investment Matthew Sherwood said that the markets have "moved into a 'sell on the rumor, buy on the fact' mode in the wake of the end of the US' earnings season and rising concerns about US' Federal Reserve's quantiative easing (QE) tapering."

Elsewhere, the Bank of Japan (BoJ) left its monetary policy unchanged, in line with market expectations. The central bank also left its assessment of the economy unchanged, at the end of a two-day policy meeting. The BoJ said in a statement that the Japanese economy "is starting to recover moderately."

In South Korea, the central bank left its policy rate unchanged for a third consecutive month, which was widely expected.

"China trade data for July indicates a rebound of external demand and a resurgence of domestic demand," said Dariusz Kowalczyk, senior economist and strategist of Asia ex. Japan at Credit Agricole.

"All this confirms our view that the [Chinese] economy has bottomed out and will re-accelerate in the second half. We'd like to call the end to worries over China for this year," he added.

A raft of Chinese economic data will be released on Friday, which include inflation figures, industrial output numbers, fixed-asset investment and retail sales data.

On Wall Street, indices ended low on renewed concerns about the timing of theFed's QE taper.

The Dow finished 48.07 points lower at 15,470.67, pulled down by Disney and Bank of America. The S&P 500 closed 6.46 points lower at 1,690.91, while the Nasdaq ended 11.76 points lower at 3,654.01.

On Tuesday, The Walt Disney Company reported an almost flat profit for the third quarter, and projected a large loss on the film 'The Lone Ranger', leading to a plunge in its shares in after-hours trading.