Europe Markets

European stocks close higher, rebounding after tech-led sell-off

Key Points
  • The pan-European Stoxx 600 closed up by 1.6%, with the tech and telecoms sectors both jumping over 2%.
  • Travel and leisure shares bucked the trend, falling over 0.8% as coronavirus containment measures return.

European stocks closed higher Wednesday as investors looked to shrug off a technology-led rout earlier in the week that put pressure on financial markets around the world.

The pan-European Stoxx 600 closed up by 1.6%, with the tech and telecoms sectors both jumping over 2%. Travel and leisure shares bucked the trend, falling over 0.8% as coronavirus containment measures return.

European markets received a negative handover from Asia Pacific Wednesday as investors react to declines on Wall Street. The Nasdaq Composite dropped 4.1% to close at 10,847.69 Tuesday, meaning the tech-heavy index was down 10% over the past three days. The Dow Jones Industrial Average plunged 632.42 points, or 2.3%, to end its trading day at 27,500.89. The S&P 500 slid 2.8% to close at 3,331.84.

Shares of Japanese conglomerate Softbank Group fell more than 3% in Asia overnight. The stock has plunged more than 10% since its Friday close after a Financial Times report identified the firm as the "Nasdaq whale" that bought billions of dollars in technology company stock options over the past month

But on Wednesday, U.S. equity markets turned positive with tech shares clawing back some of the steep losses that pushed the Nasdaq into correction territory. Shares of Tesla, which had their single worst day ever on Tuesday dropping 21%, rose 6.7% Wednesday. Apple, which lost more than 6% in the previous session, was up by 5%.

Oil markets remain in focus for investors too after crude prices plunged overnight, hitting lows not seen since June, amid renewed demand concerns due to rising coronavirus infection rates across the U.S. and Europe.

AstraZeneca initially fell Wednesday following a plunge in extended trading Tuesday, after the company said a late-stage trial of its Covid-19 vaccine candidate had been put on hold due to safety concerns. However, shares turned positive later in the day, closing about 0.5% higher.

Scor jumped 11% after the French reinsurer confirmed a new strategic plan, while Sweden's Loomis saw its shares climb 5% after launching "Loomis Pay," a payments product. Swedish Orphan Biovitrium and Old Mutual added more than 7%.

At the other end of the European blue chip index, Tui and Carnival fell 5% and 6% respectively amid a broad decline for travel stocks.

- CNBC.com staff contributed to this market report.