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Europe closes higher; Stoxx 600 hits 20-month high on Macron rally: Christian Dior up 11%

European stocks closed higher Tuesday after hitting multi-year highs in the previous session on news centrist presidential candidate Emmanuel Macron had won the first round of the French election.

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The pan-European Stoxx 600 provisionally ended 0.21 percent higher with most sectors and major bourses in positive territory. The European benchmark rallied to hit highs not seen since August 2015 with stocks supported by gains on Wall Street.

Health care closed as the best performing sector on Tuesday. Swiss chemicals and life sciences group Lonza upgraded its sales growth forecast to high-single digit from mid-single digit, Reuters reported. Its shares rose 4.1 percent on the news. Elsewhere, Novartis announced first-quarter core net income fell 4 percent to $2.69 billion, beating expectations. Its shares rose 2.1 percent on Tuesday.

Household goods were also higher after the luxury goods company Louis Vuitton said it would take full control of Christian Dior by buying the stake in the fashion company it does not already own. LVMH rose 3.9 percent while Christian Dior jumped 11 percent on the news.

Banking stocks extended gains made during the previous session on hopes the centrist candidate Emmanuel Macron will become the next president of France. Analysts believe this scenario should boost the second largest euro economy and keep the euro zone intact. Furthermore, Credit Agricole announced it would consider buying three savings banks in Italy. The French lender said the project "is still in its very early stages." Its shares were marginally higher on Tuesday.

Meanwhile, in the U.S., the Dow Jones industrial average and broader S&P 500 both continued higher while the Nasdaq composite index crossed the 6,000 level for the first time in its history. U.S. stocks were boosted by a deluge of strong corporate earnings to extend gains from the previous session.

Whitbread falls 8%

Looking at individual stocks, the Finnish engineering group Metso jumped 5.6 percent after reporting higher-than-expected profits for its first quarter. Shares of Volvo Group rose 7.6 percent after the Swedish truck maker announced adjusted profits of $794 million - well above forecasts.

The trading day wasn't as positive for the Britain's Whitbread, which dropped over 7 percent on Tuesday. The firm reported higher revenues and profits for the full-year but it stated that it expects consumer confidence to fall.

The mining firm Boliden dipped 6.6 percent after profits lagged expectations due to a slowdown in mining output, Reuters reported.

In the corporate world, investors also heard from Virgin Money and Swedbank. The former said that gross mortgage lending fell slightly to £2 billion ($2.56) from £2.1 billion a year ago, sending its shares 1.2 percent lower. The Swedish banking group announced a 20 percent increase in first-quarter operating profits. Its shares closed under pressure on Tuesday.

Politics, currency and data

The victory of the centrist Emmanuel Macron in the first round of the French election sent French stocks to a nine-year high on Monday, which also drove other European stocks higher. The euro edged higher on Tuesday, trading at around $1.0935 at 4.50 p.m London time.

In the U.S., President Trump has indicated that he might wait for a budget blueprint before seeking funding for building a wall on the border with Mexico. Meanwhile, the largest world economy has imposed tariffs of about 20 percent on Canadian softwood lumber.

In terms of data, French business showed no signs of concern over the ongoing presidential race with sentiment stable at 104 in April, statistical office Insee said.

Meanwhile, in the U.K., the gap in final incomes between the richest and poorest households dropped last month.

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