European stock markets are trading higher on Monday, driven largely by gains for banks across the board, though volumes were expected to be thin as many traders remained out for an extended New Year’s break.

Europe's leading Blue-chip index, EURO STOXX 50 went up 30.52 points or 0.93 percent to trade at 3,302.28. UK's benchmark index FTSE 100 rose 22.57 points or 0.32 percent to trade at 7,142.83.

Meanwhile, Germany's benchmark index DAX gained 96.19 points or 0.84 percent to trade at 11,577.25. French benchmark index CAC 40 gained 12.83 points or 0.26 percent to trade at 4,875.14.

On Friday, European stock markets settled higher. Europe's leading Blue-chip index, EURO STOXX 50 rose 18.76 points or 0.57 percent to settle at 3,290.52. UK's benchmark index FTSE 100 went up 22.57 points or 0.32 percent to close at 7,142.83.