European markets close sharply higher despite global fears over Middle East conflict

An underwater gas and communications pipeline between Finland and Estonia has been damaged, which the Finnish government has attributed to "external activity," according to an official statement. European gas prices have spiked as a result.

An investigation into what happened has been underway since Sunday, and it remains unknown what specifically caused the damage. "These events have no impact on our security of supply," Finnish President Sauli Niinisto said in a statement.

The front-month gas price at the Dutch Title Transfer Facility (TTF) hub, a European benchmark for natural gas trading, was last seen 11.8% higher, trading at 49.15 euros ($52.14) per megawatt hour.

"The fall in pipeline pressure was quite fast, which would indicate it's not a minor breach. But the cause of it remains unclear," a Baltic energy official with knowledge of the situation told Reuters.

The pipeline stretches between Inkoo in Finland and Paldiski in Estonia, across part of the Baltic Sea that stretches into Russian waters.

— Hannah Ward-Glenton

Mercedes-Benz Trucks CEO Karin Rådström discusses the outlook for the company's new electric vehicles.

U.S. stocks opened in the green on Tuesday.

• The S&P 500 was up 0.1%, or 4.5 points.
• The Dow Jones Industrial Complex gained 0.15%, or 50 points.
• The tech-heavy Nasdaq inched higher by 0.1%, or 16 points.

— Pia Singh

Austrian central bank governor, Robert Holzmann, says the European Central Bank could implement one or two more interest rate increases if there are "additional shocks" to the economy.

The International Monetary Fund on Tuesday raised its U.S. growth projection for this year by 0.3 percentage points compared with its July update, to 2.1%.

It also lowered its euro zone forecast by 0.2 percentage points, to 0.7%, and reiterated a global growth forecast of 3% for the year.

"What we're seeing is an economy that has been quite resilient given the shocks it has experienced over the last year and a half. The Russian invasion of Ukraine, the energy crisis, and the tightening of monetary policy around the world," IMF Chief Economist Pierre-Olivier Gourinchas told CNBC at the group's annual meetings in Marrakech.

"What we're saying also is that 3% is not a global recession, far from it, but it's also not the kind of growth that we're used to when looking at the pre-pandemic period, which was more around 3.6, 3.8%. So we characterize this by saying the global economy is kind of limping along, it's not sprinting right now."

— Jenni Reid

European stocks were sharply higher Tuesday morning, mirroring strong global gains, with the benchmark Stoxx 600 index up 1.2% at 9:13 a.m. London time.

All sectors were in the green, and some of the top climbers are those that suffered on Monday, including travel and leisure.

Germany's DAX rose 1.5%, while the U.K.'s FTSE 100 and France's CAC 40 both posted gains of around 1.3%.

— Jenni Reid

Chinese real estate developer Country Garden Holdings said it expects it will not be able to make all of its offshore repayments, including those issued in U.S. dollar notes.

The company on Tuesday failed to make a debt repayment of 470 million Hong Kong dollars ($60 million), as it warned creditors could demand faster repayments of debt or pursue enforcement action. 

Read the full story here.

— Lim Hui Jie, Shreyashi Sanyal

U.K. retail sales increased by 2.7% in September, up from 2.2% growth the previous year but below the 12-month average growth of 4.2%, according to figures from the British Retail Consortium.

Food sales were up 7.4% as non-food sales fell 1.2%.

"Sales growth in September slowed as the high cost of living continues to bear down on households," said Helen Dickinson, chief executive officer of the BRC.

Dickinson said growth had been artificially boosted by high inflation over the last two years as sales revenues increased even as sales volumes decreased.

"After years of battling challenges, the resilience of the retail sector has been dented and we are starting to see the gap between the strongest and the weakest on the high street widen," said Paul Martin, U.K. head of retail at KPMG.

— Jenni Reid

The next 10 years will be unlike the last two decades for investors, according to investment advisors and wealth managers.

Charles-Henry Monchau, chief investment officer at Swiss private bank Syz, said investors risk making long-term decisions with a "cognitive bias" and urges those investing $1 million over the next decade not to extrapolate too much from recent history.

Jamie Cox, financial planner at Harris Financial Group, believes international stocks will outperform U.S. stocks in the coming decade as rising rates and inflation change market dynamics.

Both share with CNBC Pro their thoughts on how investors with $1 million should invest over the next decade.

Subscribers can read more here.

— Ganesh Rao

The odds of another rate hike from the Federal Reserve in November is falling, according to the CME FedWatch Tool.

Markets are pricing in an 86% likelihood on Monday that the Federal Reserve will hold rates steady at next month's policy meeting. That's up sharply from a 72.9% chance on Friday.

— Sarah Min

The conflict between Israel and Hamas may not have a direct impact on oil supply, but it's likely to drive up oil prices in the short term just based on fears of a wider escalation, according to analysts.

CNBC Pro asked fund managers and analysts which energy names they would focus on.

CNBC Pro subscribers can read more here.

— Weizhen Tan

Gold futures, the U.S. dollar and U.S. Treasuries all rose in early trading Monday as investors sought what are perceived to be safe ports in a world of increased violence, expanding defense budgets and uncertain inflation.

Gold rallied about $28 the ounce to $1859.80, up 1.53%, according to FactSet.

The DXY Index that measures the value of a dollar against six global currencies, but mostly the euro and the yen, rose as high as 0.4712% Monday, to 106.60.

Although the bond market is closed for Columbus Day, 10-year Treasury futures added about 0.67%, the five-year gained 0.50% and the two-year by 0.20%.

— Scott Schnipper

Goldman Sachs is bullish on Japan right now and says one sector in particular is seeing a "high level of interest" following rallies of around 30%.

The bank reveals two stocks to buy and gives both around 20% upside potential.

CNBC Pro subscribers can read more here.

— Amala Balakrishner

European markets are expected to open lower Tuesday.

The U.K.'s FTSE 100 index is expected to open 43 points lower at 8,381, Germany's DAX down 60 points at 18,708, France's CAC 33 points lower at 8,139 and Italy's FTSE MIB down 140 points at 34,788, according to data from IG.

Earnings come from Kingfisher, Smiths Group, Fresnillo and Generali. Euro zone trade balance and construction data for March are due.

— Holly Ellyatt