European shares rose to a two-week high on Tuesday as investors expected a potential end to the longest U.S. government shutdown in history and assessed mixed forecasts from telecom companies including Vodafone and INWIT.
The pan-European STOXX 600 (.STOXX) climbed 0.7% to touch a two-week high of 576.91 points by 0920 GMT.
European stocks logged their biggest daily gain in six months on Monday, with traders hoping an end to the U.S. government shutdown could mean a restart of crucial official data releases.
The U.S. Senate passed a deal that would restore U.S. federal funding and end the longest shutdown. However, some caution lingered on the potential impact the lack of government funding so far could have had on the world's largest economy.
"The bigger issue is, has it exacerbated a gradual slowing of the U.S. economy. That is one of the things that we'll look for when we begin to see more data releases coming out of from federal sources," Richard Flax, chief investment officer at Moneyfarm said.
Market focus was also on the corporate earnings season.
Vodafone <VOD.L> gained 4%, lifting the broader telecommunications sector (.SXKP), after the British company upgraded its full-year forecast for both earnings and cash flow and returned to top-line quarterly growth in Germany.
On the otherhand, INWIT (INWT.MI) slid 8.4% after Italy's biggest mobile telecoms towers company lowered its revenue outlook for the following year despite a quarterly profit jump.
"The overall earnings picture is still a little bit mixed. Over the course of the year you've seen downgrades to growth expectations in Europe for certain sectors," Flax added.
Meanwhile, Swiss stocks (.SSMI) hit a two-week high, with Richemont <CFR.S> and Swatch Group <UHR.S up 1.6% and 3.6%, respectively, on relief as U.S. President Donald Trump said he was working with the country on a deal to lower the 39% tariff rate it faces on exports.
Fraport <FRAG.DE> advanced 10.5% after the Frankfurt Airport operator reported upbeat third-quarter core earnings, helped by an around 50-million-euro reduction in personnel costs related to a one-off pension plan refund.
UK's internationally-focused FTSE 100 (.FTSE) outperformed major bourses in the region and hit a record high, aided by a weaker pound as investors added to bets that the Bank of England could lower interest rate cuts in December after data pointed to slowing jobs growth. IRPR
