(Bloomberg) -- European equities gained the most in five weeks as investors assessed last month's selloff ahead of the impending U.S. presidential election.
The Stoxx 600 rose 1.6% at the close, with travel and leisure the only sector to retreat. The U.K.'s FTSE 100 rose 1.4% as the pound fell after Prime Minister Boris Johnson said England will move into a four-week partial lockdown, with measures that include the shuttering of bars and restaurants and non-essential shops.
Investors are bracing for the results of Tuesday's electoral contest between U.S. President Donald Trump and Democrat Joe Biden, as large swathes of Europe enter lockdown this week. The Stoxx 600 last month snapped out of its trading range to tumble to a five-month low as rising virus cases and the impending presidential election unsettled markets.
“Clearly the U.S. elections this week are likely to be a pivotal driver for equities,” UBS Group AG strategists led by Nick Nelson wrote, adding that region saw a “normal bull market correction but at twice the speed” with the Stoxx 600 close to their year-end target of 340.
“European equities are one of the regions most exposed to the improvement in the polls for Biden,” they added.
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