The pan-European Stoxx 600 was up more than 1.6 percent during mid-morning deals, with almost all sectors in positive territory. Germany's DAX index led the gains among the major bourses, surging around 2.5 percent Monday morning.
Europe's basic resources stocks — with their heavy exposure to China — jumped almost 5 percent as investors reacted to a cease-fire on tariffs between Washington and Beijing. Antofagsta, Glencore and Anglo American were all trading more than 6 percent higher on the news.
Meanwhile, autos stocks rose over 4 percent higher Monday morning. The sector has suffered significant losses year-to-date amid heightened fears of tariffs and slowing growth in car sales. But, a deal preventing an escalation in the global trade war pushed every European carmaker into positive territory. Faurecia, Valeo and Daimler were the top performers, all trading more than 7 percent higher.
Looking at individual stocks, Netherlands-based pharmaceutical company Argenx rose toward the top of the European benchmark. Shares of the group soared 10 percent after Argenx announced it would enter an exclusive global collaboration and license agreement with Cilag, an affiliate of Jansen. The deal is reported to potentially be worth $1.6 billion.
Dutch company Signify slipped to the bottom of the index, after J.P. Morgan revised its stock recommendation to "underweight" Monday morning. Shares of the Amsterdam-listed stock were down more than 5 percent.
Market focus is largely attuned to global trade developments, after Washington and Beijing effectively agreed to pause their trade war and work toward a more comprehensive pact. Trump and Xi reached the cease-fire over a working dinner in Buenos Aires on Saturday evening.
The political deal, which appears to do little to resolve the stark differences between the world's two largest economies, should see both sides hold off on slapping additional charges against each other's goods in the short term.
Over the next 90 days, American and Chinese officials will continue to negotiate lingering disagreements on technology transfer, intellectual property and agriculture.
The progress on Sino-U.S. trade provided emerging markets and trade-exposed currencies with a much-needed boost Monday morning.
In Asia, MSCI's broadest index of Asia-Pacific shares, excluding Japan, rose almost 2 percent on the news.
Back in Europe, investors are likely to watch out for a final reading of the euro area's Markit manufacturing PMI data for November at around 9:00 a.m. London time.