Europe's main stock markets rebounded on Tuesday as investors reacted to company updates and regional economic data, a day after indices had slid on China slowdown concerns and Ukraine tensions.
Trade was also boosted by talk from the European Central Bank that looser monetary policy could be in the offing.
London's benchmark FTSE 100 index ended the day up 1.30 percent at 6,604.89 points in the wake of official data showing a drop in British inflation.
Frankfurt's DAX 30 jumped 1.63 percent to 9,338.40 points, with traders shrugging off news of falling German business confidence.
In Paris, the CAC 40 climbed 1.59 percent to 4,344.12 points.
"Central Bank members have been rather talkative today. It is their talk that has sustained the market," said Alexandre Baradez, an analyst from IG.
Slovak central bank chief and ECB Governing Council member Josef Makuch said the bank is prepared to combat deflationary risks threatening the recovery in the eurozone.
"Several (ECB) policy makers are ready to adopt nonstandard measures to prevent slipping into a deflationary environment," Makuch said.
The news was welcomed on the markets, driving up share prices mid-session after a more subdued start to the day.
EasyJet shares advanced 3.68 percent to 1,692 pence after the British no-frills airline said it expected to report lower losses than thought for its first half-year.
Home improvements group Kingfisher soared 5.98 percent to 430.8 pence after it said that it would return money to shareholders alongside news of a jump in annual profits.
On the downside, Royal Mail lost 3.17 percent to 565.5 pence after Britain's main postal operator said it planned to axe 1,600 jobs under a fresh cost-cutting drive six months after the group was partly privatised.
Wall Street stocks mostly reversed a two-day slide on Tuesday as a US home-price index rose in January for the 24th consecutive month.
In midday trade, the Dow Jones Industrial Average jumped 0.48 percent to 16,355.50.
The broad-based S&P 500 rose 0.26 percent to 1,862.28, while the tech-rich Nasdaq Composite Index tacked lower to 0.06 percent at 4,224.43.
In foreign exchange trading, the euro fell to $1.3806 from $1.3839 late on Monday in New York.
The European single currency dropped to 83.57 British pence from 83.88 pence, while the pound grew to $1.6517 from $1.6498 on Monday.
On the London Bullion Market, the price of gold rose to $1,313.50 an ounce from $1,310.75 on Monday.
"US markets are clearly looking for the next big impetus to push higher or lower and one suspects this will either be a geopolitical event pushing markets down or a surprise boost to US (or Chinese) economic growth pushing markets higher," said Jasper Lawler, market analyst at CMC Markets.
- Crimea hits German confidence -
Britain's 12-month inflation slowed to 1.7 percent in February, the lowest level for more than four years, official data showed on Tuesday.
In January, it had stood at 1.9 percent, just under the Bank of England's target rate of 2.0 percent.
With inflation low and British unemployment not yet below 7.0 percent, the Bank of England's Monetary Policy Committee is likely to keep its main interest rate at a record-low level of 0.50 percent this year, according to economists.
The German Ifo business confidence fell for the first time for five months in March, as the Crimea crisis hurts sentiment in Europe's biggest economy.
The Ifo economic institute's closely watched business climate index fell to 110.7 points this month from 111.3 points in February.
Russia said that its suspension from the G8 group of major economies was counterproductive, as Ukraine pulled more troops out of Crimea, effectively acknowledging defeat following Moscow's annexation of the Black Sea peninsula.