European autos and miners surged higher in Monday trade following the news that China and the United States have brokered a trade war truce.
Over the weekend President Donald Trump and his Chinese counterpart Xi JinPing agreed not raise tariffs further for at least 90 days. The two superpowers have also said they will try to overcome contentious issues including "forced technology transfer, intellectual property protection, non-tariff barriers, cyber intrusions and cyber theft."
Europe's basket of basic resources stocks jumped more than 5 percent shortly after the opening bell, as investors reacted to the cease-fire. Antofagsta, Glencore and Anglo American were all trading more than 6 percent higher on the news.
Miners are sensitive to trade tariffs as they provide the raw materials for China's vast amount of steel and other resources.
Overnight data showed the manufacturing sector in China accelerated slightly in November, providing a further boost to growth related stocks. Trump also tweeted overnight saying China had "agreed to reduce and remove tariffs on cars coming into China from the U.S."
At the open of European trade, the grouping of autos and auto suppliers ripped more than 5 percent higher. Both BMW and Daimler gained more than 6 percent while Volkswagen, Porsche and Fiat Chrysler also enjoyed strong gains.
China currently has a 40 percent tax on US-imported cars, affecting roughly $10 billion worth of passenger vehicles each year.
That tax has a disproportionately negative effect on German auto giants who build a large number of cars in the U.S. for export and sale to Chinese customers.
U.S.-based firms Fiat Chrysler and Ford already have Chinese manufacturing plants in place and are seen as relatively immune to trade threats.