LONDON — European stocks advanced on Tuesday amid growing optimism that another effective coronavirus vaccine has been discovered, and on news that the Trump administration has accepted President-elect Joe Biden’s transition into office.
The pan-European Stoxx 600 climbed 0.7% in early trade, oil and gas stocks bouncing 2.4% to lead gains as almost all sectors and major bourses entered positive territory.
European markets are tracking U.S. stock futures which climbed in overnight trading on Monday following a strong session on Wall Street boosted by positive vaccine news from AstraZeneca, which said interim analysis showed its coronavirus vaccine has an average efficacy of 70%. The news followed strong results from Pfizer-BioNTech and Moderna regarding their vaccine candidates.
The gains in futures also came after General Services Administration chief Emily Murphy told President-elect Joe Biden that the Trump administration is making federal resources available for his transition into office.
Murphy had withheld her decision on ascertaining Biden’s electoral victory for weeks after the Nov. 3 election; President Donald Trump soon tweeted that he approved of the move.
News that Biden has picked former U.S. Fed Chair Yellen to be Treasury secretary may also have buoyed investor sentiment on Tuesday. If confirmed by the Senate, she is set to be the first woman to lead the department. Stocks in Japan led gains among Asia-Pacific markets in Tuesday trade.
There are no major earnings from Europe Tuesday; on the data front, Germany’s Ifo Institute releases the latest business climate survey results.
Norwegian real estate company Entra jumped 11.5% in early trade amid takeover speculation, while airplane engine manufacturer Rolls-Royce climbed more than 7%. At the other end of the European blue chip index, Swedish property management firm Fastighets dropped 4%.
Subscribe to CNBC PRO to access live PRO Talks, including our Dec. 2 discussion on opportunities and risks in international markets.
– CNBC’s Yun Li and Kevin Breuninger contributed reporting to this story.