European stocks closed higher Wednesday after British lawmakers defeated Prime Minister Boris Johnson's government in a vote to seize control of parliamentary business, moving closer to blocking a no-deal Brexit.
The pan-European Stoxx 600 was up 0.9% at the closing bell, basic resources jumping 2.9% to lead gains as all sectors and major bourses traded in positive territory.
In the House of Commons on Tuesday night, MPs voted to allow a bill to block a no-deal Brexit to be introduced, defeating the government by 27 votes as 21 lawmakers from Johnson's own ruling Conservative party voted with the opposition. Johnson said following the vote that he would table a motion for a general election, but main opposition Labour party leader Jeremy Corbyn said he will not back the early election unless the bill ruling out no-deal is passed first.
Meanwhile, the Bank of England lowered its estimate for the scale of damage to the U.K. economy in a no-deal Brexit scenario, Reuters reported on Wednesday. Sterling gained on Wednesday afternoon, rising to $1.2189 having fallen as low as $1.1958, its lowest since an October 2016 flash crash, during Tuesday's session.
Hong Kong stocks surged nearly 4% on Wednesday with confirmation that the extradition bill which triggered months of violent mass protests has been fully withdrawn. Lam had suspended the bill in June but protests continued, with Sunday proving the most violent day since mass protests first broke out.
Stocks on Wall Street were also trading higher on Wednesday, as investors digested the developments in Hong Kong.
Back in Europe, Italian stocks rallied after Prime Minister Giuseppe Conte announced that the Democratic Party (PD)'s Roberto Gualtieri would become the new government's economy minister. Luigi Di Maio, leader of the anti-establishment Five Star Movement (M5S) will be foreign minister, while the new interior minister will be Luciana Lamorgese, who has no political affiliation, Reuters reported. The FTSE MIB was up 1.6% on the back of the news.
At the other end of the European blue chip index, Danish medical equipment maker Ambu's shares were down 6.8% at the closing bell.
Iliad shares fell 5.5% after Bank of America Merrill Lynch cut the French telecoms company's price target, while Barratt Developments shares shed 3.6% after first half results as Brexit continues to weigh on Britain's construction sector.