Tech, Auto Help European Shares’ Best Gains in One Year

European stocks jumped 2.5% on Tuesday, boosted by a solid rebound in technology shares as worries somewhat eased over the Omicron coronavirus variant, while German shares surged close to 3% led by automakers.

Likewise, the continent-wide STOXX 600 Index witnessed its best session since last November, bouncing back to levels before worries emerged about the new virus variant.

Last week’s sellers have been rudely pushed out of the way in a mad scramble to get back into equities now that Omicron fears are receding almost as fast as they appeared. Billions have been wiped on to share prices since Friday’s lows, December living up to its reputation as one of the strongest months for shares.

Technology stocks surged 5.6% after hitting seven-week lows on Monday, while miners jumped as copper and iron ore prices were lifted by biggest consumer China easing its monetary policy. There is relief that although global fiscal policy is set to tighten over the next six months, it’s not going to be within the next month.

The STOXX 600 is just about 2% below its record high from mid-November, while the Euro STOXX 50 volatility index (.V2TX), Europe’s fear gauge, fell to 14.87. At the peak of the selloff in markets, it hit 33.1.

Among individual stocks, British American Tobacco (BATS.L) gained 1.0% after backing its full-year forecast, buoyed by more people switching to the tobacco giant’s vaping and oral nicotine products. read more

Defensive sectors such as healthcare (.SXDP) and food & beverages (.SX3P) were among decliners on STOXX 600.