LONDON: European stocks rebounded on Tuesday with investors taking heart after Russia scaled back troop exercises near Ukraine that had sent markets sliding in the previous session on fear it could spill over into war.
The pan-European FTSEurofirst 300 index rose 1.1 percent to 1,332.35 points, recouping roughly half of the losses suffered on the previous day, after Russian President Vladimir Putin ordered troops that took part in military exercises in central and western Russia to return to base.
Finnish tire maker Nokian Renkaat and Danish brewer Carlsberg, among European blue-chips with the biggest exposure to Russia, were strong gainers in response.
“There’s a perception that maybe we’re going see a ratcheting down of tensions and there’s a possibility that President Putin may be open to dialogue and that’s why markets are bouncing,” Michael Hewson, chief market analyst at CMC Markets UK, said.
“I would be sitting on the sidelines still because it’s a very fluid situation. We’re going to continue to see a certain amount of volatility and it would be a brave investor who dives back in now.”