LONDON: European stocks surged in 2013 on growing investor optimism, supportive central bank monetary policy and easing eurozone crisis fears, dealers said.
London's benchmark FTSE 100 index of top companies leapt 14.43 percent over the last 12 months in the biggest annual increase since 2009, aided also by the recovering British economy.
The FTSE rose by a modest 0.26 percent on Tuesday to end 2013 at 6,749.09 points in an early finish.
The French CAC 40 meanwhile soared 18 percent over the course of the year, after adding 0.47 percent in value to end at 4,295.95 points on Tuesday.
"This year most likely will be remembered as a year where things in Europe started finally to stabilise," said Markus Huber, trader at broker Peregrine & Black.
"In 2013, many investors were simply relieved that the European financial crisis did not get worse."
Looking ahead, he added: "2014 should show if the financial crisis can really be left behind or if the calm has only been temporary. In the long run it will only be economic growth and low budget deficits and debt which will convince investors that the financial crisis has indeed been overcome."
Frankfurt's DAX 30 was shut on Tuesday, one day after falling 0.39 percent to finish the year at 9,552.16 points.
Over the course of 2013, however, Frankfurt soared by a staggering 25.5 percent, after a series of record peaks.
"2013 has been a stellar year for the stock market," said analyst David Madden at trading firm IG.
"The eurozone has managed to shake its debt-crisis image, even though little has actually improved in terms fundamentals."
Stocks have also been boosted by the upbeat global economic outlook, low interest rates and central bank stimulus policies.
Like central banks in Britain, the United States and Japan, the European Central Bank (ECB) has used super-low rates and injected liquidity into the financial system to encourage lending and thereby boost investment and consumer spending.
"Markets have been propped up by looser monetary policies and stimulus from the US Federal Reserve, Bank of England, Bank of Japan and ECB, as investors take advantage of the ample supply of liquidity being pumped by these central banks," ETX Capital trader Ishaq Siddiqi told AFP.
He added that the "low interest rate environment for US, UK and eurozone means the atmosphere ... is seen as accommodative, allowing risk appetite to build".
Huber noted that central banks had helped to soothe eurozone worries.
"Very low interest rates for an extended period of time, set by major central banks, and decisive action on their part have contributed for the storm in the financial markets, caused by the European financial crisis, to subside," he said.
Frankfurt, London and Paris will remain closed on Wednesday for New Year's Day and will reopen for business on Thursday.
Investor sentiment was also bolstered this year after the Fed decided earlier this month to scale back its vast $85 billion-per-month stimulus policy.
Dealers drew strength from the Dow's record close overnight on Wall Street, with the market jumping 0.16 percent to register its fourth all-time high in the past five sessions and the 51st of the year.
The Dow Jones Industrial Average rose 0.16 percent to close at a record 16,504.29 points on Monday.
The index has risen about four percent since the Fed announced on December 18 that it plans to scale back its stimulus in January 2014, boosting hopes over the health of the world's biggest economy.
Across in Asia on Tuesday, equities mostly rose on the last day of 2013, after another record-breaking session on Wall Street.
Hong Kong stocks added 0.26 percent to close at 23,306.39 points putting on 2.87 percent in 2013.
Sydney was flat but closed the year more than 15 percent higher.
Shanghai won 0.88 percent. However, the Chinese market finished down 6.75 percent for 2013, making it one of the world's worst performers.
Tokyo, Manila, Seoul, Bangkok and Jakarta were closed for the holiday.
While Japan's Nikkei closed Monday with a 57 percent advance over the year its strongest performance in four decades making it the world's best performer Shanghai ended a torrid 2013 that saw it suffer two liquidity crises.
The US dollar was pressured Tuesday by data showing that US pending home sales rose 0.2 percent in November. That was the first rise in five months but below forecasts of a 1.5-percent gain.
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