European stocks ended almost unchanged on Friday but ended the month with a solid gain as investors bet the worst of Europe's debt crisis is over and that a deal in U.S. budget talks will be reached before year end.

The FTSEurofirst 300 index of top European shares ended 0.08 percent lower Friday at 1,120.89 points, after hitting a high of 1,125.12 during the session, a level not seen since July 2011.

For November, the index posted a gain of 2.2 percent — its sixth straight positive month, the index's longest run of successive monthly gains in eight years.

"There's been a strong reversal in sentiment," said Marc Renaud, chief executive officer of Mandarine Gestion, which has 1.45 billion euros ($1.89 billion) in assets under management.

"We're now seeing inflows into equities, albeit still modest, and the volatility has tumbled to levels not seen since the start of the financial crisis. We can finally do our job as stock pickers."

Shares in LVMH, the world's biggest luxury goods maker, was the top blue-chip performer Friday, up 1.3 percent after Goldman Sachs upgraded its recommendation on the stock to 'buy', forecasting an improvement in demand from China.

France Telecom was the biggest loser among major companies, down 1.9 percent as speculation swirled of an imminent shake-up of the STOXX Europe 50 from which the telecom operator could be dropped.