"Fuck you" can be used to mean roughly "go to hell." However, in this particular sentence I think it is used jovially. In some cultures it is common to use a pretty brutal insult against a friend and mean it in an affectionate way. In essence saying "you're an ass but I like you anyway." So literally it means "go to hell", but in this case it probably means something closer to "you're a likable butt head."
Update: I was thinking about this some more, and I was curious about the real meaning of the insult. "Go to hell" makes a specific statement of what bad thing you want to have happen to the target of your insult -- that they go to a bad place, For sure, it is perhaps not meant literally, but at least it has some specific hurtful desire in mind. However, the meaning of "fuck you" did not have an obvious meaning to me, in the sense of expressing what particular bad thing I wanted to happen.
However, I came across this quote from Carl Sagan which seems plausible, and I thought might be interesting from an entertainment point of view. I don't assert it is correct, I just offer it as an interesting data point.
I should add that this meaning that Sagan proposes does catch an important nuance of this particular insult: the meaning of "I assert my dominance over you."