European stocks closed higher Tuesday as investors shifted their focus to upcoming central bank meetings by the U.S. Federal Reserve, Bank of Japan and Bank of England.
The pan-European Stoxx 600 added 0.77% by the closing bell, led by a 2.37% rise for retail stocks while banks were the only sector to finish in the red, falling 0.93%.
Investors in Europe are looking ahead to the results of the latest U.S. Federal Reserve meeting taking place Tuesday-Wednesday, although the central bank is not expected to make any changes to its monetary policy stance, and reacting to the latest data from China.
European markets received a positive handover to start the day, with stocks in Asia-Pacific mostly higher after data showed retail sales in China rose 0.5% in August from a year ago — the first positive report for the year so far — according to the country's National Bureau of Statistics. Still, retail sales for the first eight months of the year were down 8.6% from a year ago, the bureau said.
Chinese industrial production grew 5.6% in August from a year ago while fixed-asset investment declined 0.3% for the first eight months of the year.
Stateside, stocks jumped at Tuesday's open to build on the previous session's gains, with Wall Street bolstered by a resurgence for the tech sector and strong economic data.
On the data front, Germany's ZEW survey of economic conditions, published Tuesday, showed that sentiment in Europe's largest economy significantly exceeded expectations in September.
In terms of individual share price action, British insurer Hiscox jumped 17% by Tuesday's close, after the company estimated that the fallout from a court decision over small business claims would be limited.
H&M rallied more than 10.79% after beating third-quarter profit expectations, while online supermarket Ocado climbed 10.74% after reporting a surge in sales. Fiat Chrysler also added 9% after a revision of its planned merger with Peugeot maker PSA.
At the other end of the European blue chip index, Grenke plunged 18.84% after short-seller Viceroy Research, which issued early warnings over insolvent German payments company Wirecard, published a series of misconduct and fraud allegations against against the German business bank.
- CNBC's Eustance Huang and Jesse Pound contributed to this market report.