The pan-European Stoxx 600 index gained 1.2% in early deals, with oil and gas stocks climbing 2.9% to lead gains as all sectors and major bourses entered positive territory.

Swedish cloud computing firm Sinch was the biggest climber in early trade, adding more than 9%. At the bottom of the European blue chip index, Direct Line shares plunged more than 13% after the British insurer rescinded a £50 million ($59.6 million) share buyback and cut its profit guidance.

The broadly positive start in Europe comes amid more buoyant global sentiment. In Asia-Pacific on Monday, Hong Kong’s Hang Seng jumped more than 2%, while U.S. stock index futures were modestly higher early on Monday morning after a positive end to last week.

Friday’s relief rally came as traders bet that the Federal Reserve will be less aggressive at its upcoming meeting. The Wall Street Journal reported Sunday that the central bank is on track to lift interest rates by 75 basis points at its meeting later this month, rather than a larger, full-percentage-point increase that some analysts had forecast.

Recession fears have dominated trading sentiment in recent weeks as market participants worry that aggressive action from the Fed — in an effort to tame decades-high inflation — will ultimately tip the economy into a recession.

Last week, fresh inflation data showed consumer prices jumped 9.1% in June, a hotter-than-expected reading and the largest increase since 1981. That, in turn, led traders to bet that the Fed could raise rates by a full percentage point at its meeting at the end of July.

Haleon shares commenced trading on the London Stock Exchange’s Main Market on Monday as an independent, listed company, after GSK shareholders approved the demerger of its consumer health-care business.