European markets advanced on Tuesday, attempting to regain some ground after stocks saw their worst day since the 2008 financial crisis in the previous trading session.
The pan-European Stoxx 600 jumped 3.7% by mid-morning, oil and gas and basic resource stocks surging 6% to lead the recovery as all sectors and major bourses traded firmly in positive territory.
The move comes after markets around the world tanked Monday as global investors braced for the spread of the coronavirus and oil prices fell after the collapse of OPEC talks.
In the U.S., the Dow Jones industrial average plummeted 2,013.7 points in its worst day since 2008, while the S&P 500 plunged 7.6% in Monday’s session. Trading was halted for 15 minutes after the S&P 500 sank 7% at the open.
On Tuesday, however, U.S. stock futures were higher after President Donald Trump floated the idea of “a payroll tax cut or relief” to offset the negative impact from the coronavirus. The potential tax incentives come on top of an $8.3 billion spending package Trump signed last month.
In Asia, meanwhile, shares were mixed in Tuesday afternoon trade with investors looking out for potential stimulus measures to mitigate the economic impact of the coronavirus outbreak. Governments within the Group of Seven nations could announce stimulus measures Tuesday.
Back in Europe, attention remains firmly on Italy where the government has now extended its quarantine measures to the entire country amid the worst coronavirus outbreak outside Asia. Prime Minister Giuseppe Conte said Monday that Italy’s population, which totals around 60 million, should not travel other than for work or emergencies.
In other news, oil prices jumped during Asian trading hours following Monday’s more than 20% plunge, which saw U.S. West Texas Intermediate crude and international benchmark Brent crude post their worst declines since 1991.
At the top of the Stoxx 600, Diasorin shares leaped 13.4% after the Italian diagnostic specialist announced the impending launch of a new test for coronavirus.
Royal Dutch Shell led a resurgence for energy stocks, which took a hammering during Monday’s oil market scare, jumping 8.7%. French automaker Renault climbed 10% while compatriot supplier Faurecia gained 9.6%. Tui also added 9.2% to lead an upward surge for the beleaguered travel and leisure sector.
Of the few stocks sliding into negative territory on Tuesday, Italian infrastructure group Atlantia led losses with a 3.9% decline.
— CNBC’s Yun Li, Eustance Huang and Pippa Stevens contributed reporting to this story.