European stocks rallied Monday afternoon, as investors digested fresh developments surrounding the U.K.'s withdrawal process from the EU.
European markets
The pan-European STOXX 600 closed provisionally up 1.27 percent, with most major bourses trading sharply higher. Across the board, sectors showed a positive picture with banks, autos, and insurance leading the way.
Looking to the corporate space, European lenders surged 2.63 percent on Monday, with a number of Italian banks — including Unicredit, Banco BPM and Intesa Sanpaolo — hitting the top of the benchmark. Italy continues to be closely watched, as investors monitor an ongoing budget row.
On Monday, Reuters reported, citing two government sources, that the country's governing coalition could cut 2019's budget deficit target to as low as 2 percent of gross domestic product, to dodge a disciplinary procedure from Brussels. The rise in Italian banks boosted the FTSE MIB, which jumped 2.83 percent in deals.
On the corporate side, Eurofins Scientific climbed 7.91 percent, after the laboratory testing group confirmed its objectives for 2018, and extended its organic growth goals beyond 2020.
In the tech space, Logitech announced Sunday that it had ceased talks to acquire Plantronics, a U.S. electronics group. Shares of the Swiss manufacturer rose 3.99 percent Monday.
Energy stocks received a boost during the session as oil prices pared some of their losses from Friday's declines. In European trading, U.S. crude was hovering just under $52, while Brent crude fluctuated just overthe $60 per barrel mark. The recovery in oil helped support markets in Asia, which saw a mixed to higher session.
EU backs Brexit deal, obstacles loom
Over the weekend, leaders from the European Union (EU) chose to endorse the Brexit withdrawal deal laid out by U.K. Prime Minister Theresa May. While the backing from the EU shows progress for May's withdrawal agreement, the deal still needs parliamentary approval. The British leader will now have to face officials in her home country during the weeks ahead.
Elsewhere, investors are looking ahead to a G-20 summit set to take place in Argentina later this week, where President Donald Trump and President Xi Jinping are due to meet. The summit will be watched closely for how relations between both countries develop, in addition to further news surrounding trade.
In data news, the latest ifo Business Climate figures revealed Monday that sentiment among German firms had showed signs of weakness in the past month, with the index dropping for the third consecutive time. In November, it dropped to 102.0 points, in comparison to 102.9 points last month.