Boosted by strong corporate earnings and renewed optimism about Fed interest rate cutsVideopokernearmeEuropean stock markets hit a record closing high.
The Stoxx 600 index closed up 1.Videopokernearme.1%, exceeding the closing high set on March 28. Financial services and technology stocks led gains, while auto and oil stocks lagged behind.
UBS led the rise in the financial services sector, which posted its biggest gain in more than a year as it made a profit after two quarters of losses. UniCredit shares rose after the bank reported better-than-expected profits, while chipmaker Infineon also rose.
"as the economy comes out of recession and market sentiment generally improves, the rebound in capital market activity is likely to provide a greater boost," said Janet Mui, head of market analysis at RBC Brewin Dolphin.
The FTSE 100 index also hit record highs, boosted by Shell and Glencore. BP Plc maintained the pace of share buybacks despite falling profits.
Investors also adjusted their bets on Fed policy, as weak US jobs data on Friday rekindled expectations of about two interest rate cuts by the end of the year.
Nannette Hechler-Fayd'Herbe, an analyst at Lombard Odier, expects two or three interest rate cuts this year, starting in July.
"in terms of consumption and the labour market, I think we are moving in the right direction," Hechler-Fayd'Herbe said. "what the Fed needs is not a return to the exact inflation figure of 2 per cent, but to be sure that it is on the right path."