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 3% 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.
Official figures published Tuesday showed Germany’s economy grew by a record 8.5% in the third quarter. The sharp incline in GDP (gross domestic product) was revised upward from an initial flash estimate of 8.2% and followed a 9.8% drop in the second quarter as lockdown measures weighed on activity.
A second round of restrictions to curtail a resurgence in the virus are expected to further dent Europe’s largest economy in the fourth quarter.
Norwegian real estate company Entra jumped 10.6% in early trade amid takeover speculation, while cruise operator Carnival climbed more than 9%. At the other end of the European blue chip index, German meal kit delivery company Hellofresh dropped 6.6%.
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– CNBC’s Yun Li and Kevin Breuninger contributed reporting to this story.