[LONDON] European stocks rebounded strongly in early deals Friday, with traders saying the murder of a pro-European MP in Britain had boosted the country's chance of staying in the EU.
Asia climbed also following gains overnight on Wall Street, and the pound firmed, after the murder Thursday of Jo Cox one week before the June 23 referendum on Britain's membership of the European Union.
A bitter voting campaign was on Friday suspended for a second day as the nation reeled from the death of Ms Cox, a 41-year-old former aid worker.
"The suspension of campaigning for the UK EU referendum after the tragic death of Labour MP Jo Cox boosted risk appetite," said Nick Stamenkovic, an analyst at broker RIA Capital Markets.
"The pound and euro rebounded on the news but the yen softened."
Shortly after the open, London's benchmark FTSE 100 index was up 1.2 per cent at 6,022.71 points, compared with the close on Thursday.
Frankfurt's DAX 30 index rallied 1.5 per cent to 9,689.19 points and the Paris CAC 40 won 1.4 per cent in value to trade at 4,211.68.
With polls up until Ms Cox's death suggesting that the referendum outcome was too close to call, investors had been piling into safe haven investments, notably the yen, gold and German government bonds.
But sentiment has dramatically changed since it was confirmed that Ms Cox had died.
"A positive European open follows gains in both the US and Asia that can be attributed to diminished fears of a UK exit from the European Union," said Mike van Dulken, head of Research at Accendo Markets.
"The assumption is that the tragic event will sway the undecided to vote Remain and possibly even reverse some of the Leave momentum seen in recent polls."
Witnesses told local media that Ms Cox had been repeatedly shot and stabbed.
A 52-year-old man, named by media as local Thomas Mair, was arrested. Described by neighbours as a loner, there were indications that he had extreme right leanings.