European stocks moved higher on Tuesday as bond yields eased and risk appetite improved, giving markets a firmer start after last week’s sharp sell-off.
The STOXX Europe 600 rose 0.8% to 638.41 points, putting the index on course for a third consecutive session of gains and close to a one-week high. Futures had already pointed to a stronger opening, with Euro Stoxx 50 and STOXX 600 futures both around 0.4% higher before trading began.
The recovery is being supported by a pause in the recent rise in government bond yields. Eurozone yields reached multi-decade highs last week amid concerns over inflation and government finances, placing pressure on equity valuations. Their retreat is now giving European shares some breathing room.
Technology and artificial intelligence stocks were among the areas supporting the stronger opening, while healthcare also performed particularly well.
Healthcare stocks gained 1.6%, led by Genmab, which climbed 7.6% after the Danish biotechnology company and AbbVie reported positive late-stage results for their blood cancer drug combination. The treatment reduced the risk of disease progression or death, making Genmab the strongest performer on the STOXX 600.
The move in Genmab demonstrates the potential for positive company-specific news to drive individual stocks even while the wider market remains focused on interest rates, government borrowing and political uncertainty.
Technology-related shares also benefited from the improved risk tone. Italian semiconductor testing company Technoprobe gained 2.3% after JPMorgan initiated coverage with an overweight rating.
The wider European market is now looking towards a series of economic indicators that could provide further direction. German factory orders, French industrial production and eurozone retail sales are due, alongside construction activity data from across Europe.
The data will give investors a clearer picture of the underlying strength of the European economy at a time when markets are balancing concerns over inflation and government finances against resilient demand.
Fidelity European Trust PLC (LON:FEV) aims to be the cornerstone long-term investment of choice for those seeking European exposure across market cycles.
