European shares rose on Tuesday and were set to extend gains to a third straight session, on hopes that demand from China could be sustained as authorities looked to relax COVID-19 curbs.
The pan-European STOXX 600 index rose 0.7% by 0710 GMT, with gains across all major sub-sectors, and led by travel and commodity-linked stocks .
The main index had ended flat on Monday as data showing slowing growth in China hit risk sentiment.
But sentiment received a boost on Tuesday after Shanghai achieved the long-awaited milestone of three straight days with no new COVID-19 cases outside quarantine zones, which could lead to the beginning of the lifting of restrictions.
Among individual shares, French power group ENGIE firmed 6.2% after it posted higher first-quarter profits and raised its 2022 outlook. The company also said it was in talks with Russia's Gazprom regarding changing the payment scheme for Russian gas supplies.
Daimler Truck Holding rose 4.8% on increasing its forecast for 2022 revenues to 48 billion euros-50 billion euros ($52.21 billion) from 45.5 billion euros-47.5 billion euros, with a record-high order backlog enabling it to push up prices.
Vodafone fell 3% on forecasting earnings growth for the current year below market expectations, limiting gains for London's FTSE 100 index.
(Reporting by Susan Mathew in Bengaluru; editing by Uttaresh.V)