European shares race higher; banks, oils help

European shares closed sharply higher on Tuesday as commodities stocks jumped, tracking a surge in crude and metals prices and banks rose on hopes the financial sector jitters may ease.

Expectations that the European Central Bank and the Bank of England might cut interest rates this week after Australia's move on Tuesday to sharply lower its rates also lifted sentiment ahead of the results of the U.S. Presidential election.

The FTSEurofirst 300 index of top European shares provisionally closed 4.3 percent higher at 973.39 points, registering a sixth straight day of gains. But the benchmark index is still down 35.4 percent this year.

Commodities shares led the advance, as crude oil prices surged 7.5 percent after industry sources said Saudi Arabia had already made substantial cuts in crude supplies, while copper jumped 8 percent and aluminium gained 3 percent.

BP, Royal Dutch Shell, gas producer BG Group and Tullow Oil added between 2.5 and 9 percent.

Banking shares also moved higher. UniCredit jumped 19.2 percent, Societe General advanced 11.2 percent, BNP Paribas added 5.6 percent, HBOS surged 10.1 percent and Barclays was up 8.4 percent.

Across Europe, Britain's FTSE 100 rose 4.4 percent, Germany's DAX gained 4.9 percent and France's CAC rose 4.6 percent