European shares opened higher on Tuesday, as China’s sweeping stimulus measures boosted stocks of luxury companies and miners.

The pan-European STOXX 600 index gained 0.8% to 520.40 points by 0711 GMT, and France’s CAC 40 rose 1.4%, outperforming its peers.

China’s top financial regulators unveiled their biggest stimulus since the pandemic, saying they would cut bank reserves by 50 basis points while reducing mortgage rates.

Luxury companies, which rely heavily on Chinese consumer spending, were the biggest boost on the index.

LVMH, Hermes, Kering, and Dior gained between 3.8% and 4%.

Basic resources led sectoral gains, jumping 4.4% as copper prices hit a two-month high supported by China’s measures and improving demand in the region.

European shares end higher, Commerzbank dips

Britain’s FTSE gained 0.4%, as stocks of metal miners rose on China’s stimulus plans.

The markets will also keep an eye out for comments from the European Central Bank’s board member, Elizabeth McCaul, set to speak later in the day.

Data on German business morale is set to be released at 0800 GMT.

Among individual stock moves, UK engineering firm Smiths Group lost 6.7% after its annual profit missed estimates.