European equities closed sharply higher on Thursday, on the hope that Greece would submit "concrete" proposals to creditors later that day. The pan-European Stoxx 600 ended the day up around 2.2 percent, with all major country bourses and industry sectors in the green. Britain's benchmark FTSE 100 index closed 1.4 percent higher, after the Bank of England kept its key interest rate on hold. Both the German DAX and French CAC soared, finishing up 2.3 and 2.5 percent respectively.

While the Greek stock market remained closed, other peripheral bourses outperformed, including Italy's FTSE MIB, which closed up roughly 3.5 percent. Likewise across the Atlantic, U.S. stocks rebounded on Thursday from a recent decline, as a jump in Chinese stocks overnight also boosted investor sentiment.

Euro zone leaders have given Greece until Friday to produce a detailed reform plan and Athens is expected to provide one later on Thursday.

This comes ahead of a summit of all 28 member countries of the European Union on Sunday, at which leaders will decide whether to accept the plans and negotiate a third aid program for Greece.

Read MoreGreek proposals:Tax hikes and pension reforms?

Greece has already requested a three-year loan from the European Stability Mechanism in order to stave off bankruptcy. Failure to reach a deal by Sunday could make a "Grexit"—Greece's exit from the euro zone—more likely. On Thursday, data showed Greece's April unemployment rate came in at 25.6 percent.