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European equities soared by the close on Tuesday as markets got a confidence boost from fresh European data, while investors digested more corporate earnings.
The pan-European Stoxx 600 index finished sharply higher, up 2.5 percent provisionally, with all sectors closing in positive territory.
The autos sector finished trade 2.3 percent higher after European October auto sales rose 2.7 percent in October on a year ago, according to industry data, the 26th straight month of growth. Porsche, Renault and BMW all finished trade sharply higher, above 2 percent.
Shares of the embattled carmaker closed up 1.2 percent higher, despite news that Volkswagen had manipulated the carbon dioxide (CO2) emission levels of more petrol-powered vehicles than previously disclosed, a spokesman for the carmaker said on Monday, Reuters reported.
Biotech firm, Genmab saw shares soar 11.2 percent by the close, after U.S. regulators approved an experimental blood cancer drug that the Danish biotech company had licensed in 2012 to Johnson & Johnson.
Engineering company, Smiths Group led the FTSE index higher, finishing up 10.2 percent, after posting a strong set of results for its first-quarter and reaffirmed that its expectations for the full-year remained unchanged.
French President Francois Hollande on Monday called for a united response against the so-called Islamic State, which claimed responsibility for Friday's attacks, and promised to boost security spending in France. The U.K.'s Prime Minister David Cameron also pledged to increase spending on the U.K. security services.
European stocks connected to the defence and military sectors rose, as France launched fresh strikes on targets in Syria. Airbus surged 4.3 percent, BAE Systems jumped about 2 percent, and Meggitt ended up 2.4 percent.
Markets in Asia and Europe got a confidence boost from Wall Street as investors shook off the impact of Islamist terrorist attacks in Paris Friday in which 129 people died. U.S. stocks continued posting positive gains around Tuesday's close, as investors cheered decent earnings reports.
Despite jumping on geopolitical concerns Monday, oil prices, however, came under pressure Tuesday, as investor sentiment returned to concerns over global oversupply in crude. At the close Brent crude was at $44.14 a barrel, while U.S. crude slipped further, trading at $41.31 a barrel.
Despite this, oil and gas sector was the top performing sector on Tuesday, closing up over 3 percent, with most of the sector posting strong gains. Repsol closed up over 5 percent, while Royal Dutch Shell and Subsea 7 finished trade above 3 percent.
Greece reached an agreement with its lenders on financial reforms early on Tuesday, its finance minister said according to Reuters, removing a major obstacle holding up fresh bailout loans for the cash-starved country. Athens stock exchange jumped on the back of this, finishing up over 2 percent.
U.K. deflation persisted in October, after data from the Office of National Statistics revealed the price of goods and services bought by U.K. households had fallen 0.1 percent, since October 2014. As this was in line with analysts' forecasts, the FTSE 100 and retail stocks finished trade higher.