Stock markets made a strong rally late Monday as impressive industrial figures in China and an upbeat outlook for a trade deal wiped off some of the paranoia among investors last week.
The rebound in Europe mirrored advances in Asia, where share prices again reached record levels as traders kept their bets that a US-China agreement deal was inevitable, which has fueled the asset price surge in recent weeks.
The MSCI global equity index, measuring stocks in 47 nations, grew by 0.1 percent and was near to the lows of last week.
The Euro STOXX 600 rose 0.27 percent in Europe, while the German DAX was up 0.24 percent. Shares in France and the UK were also rising.
In Asia, Chinese data helped the mood after the Caixin/Markit Purchasing Managers Index (PMI) rallied from 51.8 in the previous month to 51.8 in November, marking the fastest expansion since December 2016.
"What we had in China on the weekend, with the two PMIs beyond forecasts, is clearly a good indication of getting the global stability scenario more plausible," said Francois Savary, Chief Investment Officer at Prime Partners Swiss Wealth Management.
Savary noticed that there was also an increase in European manufacturing results, although inflation in the euro area was higher than expected.
"Not only do we have signs of economic stabilization, but we also have a reduced risk of deflation. I'm not sure if that means that markets should reach record highs, there's been a lot of positive news coming in," he added.
The surprise voting of new left-wing leaders to the Social Democrats (SPD) in Germany posed a threat to the incumbent coalition, triggering an increase in German bond yields as markets bet the path to fiscal the expansion would be eased.
US Treasury yields have also been significantly higher, with the 10-year bond yield rising at a two-week high by more than 7 basis points.
The optimistic mood among traders was also apparent in the US greenback, which has performed positively on hopes for a trade harmony. The USD rallied to a 6-month peak of 109.74 yen, the currency's strongest versus the safe-haven JPY since May.
In global commodities, prices of oil recovered moderately after a huge decline early Friday on record peak US crude output. Projections that the Oil Petroleum Exporting Countries and its key partners are set to extend their current production cuts when they gather for another round of talks this week helped fuel the rebound.
