MILAN/FRANKFURT: European stocks closed at a fresh 10-month high on Tuesday, powered by a Brexit trade deal, hopes of a bigger US stimulus package and a marathon Covid-19 vaccination campaign.

The pan-European STOXX 600 ended up 0.8%, rising for a fifth straight session. British stocks outperformed their regional peers, jumping around 1.7% in their first day of trading after the sealing of a Brexit trade agreement last week.

Irish stocks, also considered a barometer of Brexit sentiment, closed 1.3% higher at their strongest level in more than 13 years. For the day, British e-commerce firm Hut Group topped the STOXX 600 after it said it would buy Dermstore, an online retailer owned by Target Corp for $350 million in cash.

AstraZeneca rose 3.3% on news that the British government is expected to approve Covid-19 vaccine shots for emergency use within a few days. The German DAX retreated 0.2% from a record high, while France's CAC 40 index added 0.4%. Markets were also watching for increased stimulus measures from the United States.

Software group SAP rose 1.5% after its unit, Qualtrics International Inc, filed for a US initial public offering.

Travel and leisure stocks rose 1.5%, taking support from the launch of an EU vaccination drive over the weekend, with health workers and residents of care homes across the bloc among the first to get the shots from Pfizer Inc.

The sector is among the worst hit by the pandemic, but is primed for a recovery after the widespread rollout of a vaccine.

While the agreement, signed last week, clears doubts over UK-EU trade in the near term, the two are yet to hammer out the finer details of the deal- a process that is expected to take years.