(fxcue news) - European stocks closed higher on Tuesday, thanks largely to gains in the banking sector. Investors continued to assess the likely moves of Donald Trump, who began his second term as U.S. President, by signing a slew of executive orders and signaled imposition of tariffs on imports from Canada and Mexico. Investors also closely monitored developments at the World Economic Forum that kicked off on Monday in Davos, Switzerland. Auto stocks had a tough outing as Trump revoked the previous administration's executive order on electric vehicles. The pan European Stoxx 600 climbed 0.4%. The U.K.'s FTSE 100 gained 0.33%, Germany's DAX closed up 0.25% and France's CAC 40 ended 0.48% up, while Switzerland's SMI settled higher by 0.61%. Among other markets in Europe, Denmark, Finland, Greece, Ireland, Poland, Russia and Sweden ended higher. Netherlands, Norway, Portugal and Turkiye closed weak, while Austria, Belgium, Iceland and Spain ended flat. In the UK market, Lloyds Banking Group climbed 4%. Games Workshop, Endeavour Mining, Airtel Africa, Ashtead Group, AstraZeneca and Smith (DS) gained 2.2 to 3.2%. BAE Systems, St. James's Place, IAG, Admiral Group, Severn Trent, Barclays Group, Hikma Pharmaceuticals, Fresnillo, Marks & Spencer and National Grid also ended notably higher. Pershing Square Holdings, Associate British Foods and Rightmove lost 2.5 to 2.8%. Glencore, Haleon, Sainsbury (J), Anglo American Plc, Rio Tinto and Mondi closed lower by 1 to 1.7%. In the German market, Siemens Healthineers rallied about 3.3%. Siemens Energy gained nearly 3%. Sartorius closed with a gain of 1.8%. Merck, Siemens, Rheinmetall and Henkel also closed on a firm note. BMW, Porsche, Volkswagen and Mercdes-Benz lost 0.6 to 1.9%. Deutsche Post, Commerzbank and Fresenius Medical Care also closed weak. In the French market, LVMH and Hermes International both gained more than 2.5%. Essilor climbed about 1.8%, while Eurofins Scientific, Veolia, Dassault Systemes and Capgemini gained 0.9 to 1.1%. Vivendi ended nearly 2.5% down. Stellantis, ArcelorMittal, Pernod Ricard, TotalEnergies, Carrefour and STMicroElectronics lost 0.6 to 1.4%. On the economic front, data from the Office for National Statistics showed the UK unemployment rate rose slightly in the third quarter and wage growth remained high but falling vacancies signals a decrease in pay pressures. The data said the unemployment rate rose to 4.4% in the September to November period, as expected, from 4.3% in the three months to October. Average earnings excluding bonuses grew 5.6% in three months to November from a year ago, slightly faster than the forecast of 5.5%. Earnings including bonuses also climbed 5.6% annually, which was in line with expectations. German economic sentiment deteriorated more than expected in January as the economy remained in recession for the second straight year and inflationary pressure rose recently, results of a survey by the think tank ZEW showed. The ZEW Indicator of Economic Sentiment fell to 10.3 from 15.7 in December. The reading was expected to drop moderately to 15.2. Meanwhile, the assessment of current economic situation improved slightly. The corresponding indicator rose 2.7 to -90.4. The score was seen at -93.1. Data from the European Automobile Manufacturers' Association, or ACEA, showed that new car sales in the EU rebounded at the end of the year, largely driven by strong growth in the Spanish car market. New car registrations rose 5.1% year-over-year in December to 910,505 units, reversing a 1.9% fall in November. Among the four major markets, the Spanish car market showed a double-digit growth of 28.8%, followed by France with a modest 1.5% increase. Meanwhile, sales were down 7.1% in Germany and a 4.9% fall was seen in Italy.