By Susan Mathew
(Reuters) -European shares ended a volatile session with modest gains on Tuesday, as investors weighed last-ditch attempts at a Brexit trade deal while closely tracking rising coronavirus cases in the region.
After losing as much as 0.6% in the session, the pan-European STOXX 600 index closed up 0.2% to hover near 9-month highs.
London’s FTSE 100, which has been outperforming regional peers in recent sessions, was flat. [.L]
Britain said it would drop clauses in draft domestic legislation that breached the Brexit Withdrawal Agreement after it clinched a deal with the EU over how to manage the Ireland-Northern Ireland border.
While the deal is separate to wider trade talks, the agreement removes what was a major point of contention between Britain and the EU.
“Investors are looking through the noise,” said Peter Dixon, chief UK economist at Commerzbank.
“We’re at a stage now where investors are still expecting a deal, but they’re waiting for more concrete signals. The very fact that the two sides are still talking suggests that they still want a deal.”
British and European Union leaders are set to meet in the coming days for a final attempt to seal a trade deal, even as officials sounded more and more skeptical after negotiations failed on Monday.
Tuesday also saw UK begin to roll out the COVID-19 vaccine developed by Pfizer and BioNTech, the first Western country to start vaccinating its population.
Meanwhile, as infections continued to rise in Germany, Health Minister Jens Spahn said the government might tighten restrictions to control the spread beyond the partial lockdown implemented in November. A media report said the measures will be discussed this week.
The travel and leisure, one of the worst-hit by pandemic-induced movement curbs, led declines among sectors, down 1%, while the German DAX edged higher in the last hour of trading.
The ZEW economic research institute’s survey showed German investor sentiment soared more than expected in December on expectations that vaccines will boost the outlook for Europe’s largest economy.
Swedish wholesaler Beijer Ref AB was among the biggest gainers on the STOXX 600, up 7.3%, after private equity group EQT bought a stake in the company for about $1.1 billion.
Sensor specialist AMS plummeted 15.4% after a report on a possible Android sensor type change.
(Reporting by Susan Mathew in Bengaluru; Editing by Arun Koyyur and Sriraj Kalluvila)