European equities finished sharply higher on Tuesday, as investors cheered a recovery in oil prices and positive data from the autos sector.
Autos sector jumps
The pan-European Stoxx 600 index shot up to close almost 3 percent higher provisionally, with nearly all sectors closing above 2 percent.
London's FTSE finished around 2.5 percent higher, while its counterparts soared ahead, with France's CAC and Germany's DAX ending 3.2 and 3.1 percent up respectively; boosted by strong gains in autos, banks and oil.
The autos sector jumped, closing up over 3 percent after data from the European Automobile Manufacturers Association (ACEA) showed that Europe saw a 13.7 percent increase in new car registrations in November, the 27th month of consecutive growth.
Shares of scandal-hit carmaker Volkswagen closed up 1.7 percent after new VW car registrations in the EU increased 4.1 percent on the same time last year. Fiat, Peugeot Citroen, Daimler and BMW all outperformed following the EU data, all closing above 3 percent.
Oil, Fed hike eyed
Oil and gas stocks were a top performing sector, after oil prices made a comeback Tuesday, following a tumble to near 11-year lows on Monday. Brent crude bounced back sharply, last standing at $38.51 while U.S. crude shot up to $37.14, as investors' buying appetite rose.
Royal Dutch Shell, Total and Sbm Offshore all saw strong gains, while Tullow Oil jumped over 5 percent after the oil explorer announced it had discovered oil at a well in North Kenya, giving the company potential to explore other parts of the area.
Miners also got a boost after the European Union announced plans to register Russian and Chinese steel imports, which could result in duties; Reuters reported. ArcelorMittal closed up 5.5 percent.
Global stock markets are also looking ahead to the closely-watched Federal Reserve rate decision on Wednesday. The central bank is expected to raise interest rates by 25 basis points and only very gradually thereafter.
UK inflation up
National Bank of Greece was Europe's top STOXX 600 performer, ending up over 13 percent, with banks in general posting strong gains, with Banco Popolare and Swedbank up 6.7 and 4.9 percent respectively.
Elsewhere, data released on Tuesday showed U.K. inflation returned to positive territory for the first time in four months in November, but remained close to zero as it has done for most of this year, official figures showed on Tuesday.
Retailers WM Morrison, Sainsbury and Tesco were among the best performers on the FTSE, all finishing the trading session by over 4 percent, despite retail research from Kantar Worldpanel showing that the grocery market remained subdued over the last months.