(Reuters) - European shares ended higher on Tuesday, as better-than-expected data from China added to signs that sweeping lockdowns to contain the spread of the coronavirus were working.

The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, April 14, 2020. REUTERS/Staff

The pan-European STOXX 600 index .STOXX closed up 0.6% after a strong finish last week that was powered by another aggressive round of stimulus and tentative signs of the virus peaking in some hot spots.

“There are hopes that the COVID-19 pandemic is reaching an inflection point and that the EU will muddle its way through,” said Cameron Brandt, director of research at fund flow data provider EPFR.

“Cheaper energy, inventory restocking and pent-up demand will fuel a significant rebound in economic activity during the second half of 2020.”

Spanish shares .IBEX gained 0.5% as some businesses re-opened on Monday, although shops, bars and public spaces were set to stay closed until at least April 26.

Almost all the major European country bourses were trading higher, with sentiment also lifted by data showing a smaller-than-expected decline in China’s exports and imports. Analysts, however, warned a sure-footed recovery was months away.

The benchmark STOXX 600 index .STOXX has recovered about 24% - or nearly $2 trillion in market value - in the past month, fuelled by a raft of global fiscal and monetary stimulus, including the half-a-trillion euros worth of support for European economies announced last week.

Although the index remains 22.5% below its mid-February record highs, Europe's volatility gauge .V2TX has steadily declined since hitting a record high mid-March and is now at levels last seen in 2015.

The focus this week will also be on U.S. corporate earnings for a first glimpse of the business havoc wreaked by the health crisis. In Europe, earnings for STOXX 600 firms are expected to decline 22% in the first quarter and 34.2% in the second.

“Even though there will be a recession in earnings and they might fall even more than during the financial crisis, they will also bounce back much quicker,” said Simona Gambarini, markets economist at Capital Economics.

“So investors might look through a period of weakness because ultimately, it doesn’t quite matter as much if the weakness is only temporary.”

Health care stocks .SXDP were among top gainers across European subsectors, with AstraZeneca AZN.L surging 6.8% after saying it would start a clinical trial to assess the potential of Calquence in the treatment of severe COVID-19 patients.

Swedish rare disease drugmaker Sobi SOBIV.ST jumped 6.3% to the top of the STOXX 600 after reporting stronger-than-expected first-quarter earnings as the pandemic spurred higher demand for some of its pharmaceuticals.

London's FTSE 100 .FTSE lagged the broader rally, weighed down by oil stocks and a slump in British American Tobacco BAT.L on reports of a U.S. criminal probe and on signs Britain will remain under lockdown for a longer period.