European stock markets rebounded following two consecutive sessions of decline, with gains in the technology sector and a series of robust corporate results helping to offset the ongoing impact of US-Iran tensions.

The Stoxx Europe 600 index closed 0.6% higher. While personal care and media stocks underperformed, investors' bargain-hunting activities propelled technology stocks to outperform. Traders are also awaiting the next wave of corporate earnings reports to gauge whether companies' substantial investments in artificial intelligence are beginning to yield returns.

ASML Holding NV advanced 4.8%, Soitec SA surged 11%, and the broader European technology sector rose 2.1%. Concurrently, rising prices for metals like gold and copper drove gains in the basic resources sector.

Novartis AG shares gained 2% after the company reported profits that exceeded market expectations. Strong performance from its new generation of cancer drugs helped counter the impact of increased generic competition for its blockbuster drug, Entresto. Mitie Group PLC soared 39% after OCS Group International agreed to acquire the UK facilities management company for £3.1 billion ($4.2 billion).

As of Monday, companies representing 13% of the total market capitalization of the MSCI Europe Index have reported earnings. Among these, 53% have exceeded expectations, while only 28% have fallen short. The banking sector is set to be a key area of focus, facing heightened market expectations following its significant rally this year.