World stocks Tuesday extended the previous day's rally on brightening US stimulus hopes, while oil soared close to pre-pandemic levels on an outlook for stronger demand.

Silver prices sank by 5.0 percent to $27.50 per ounce, having soared the previous day to an eight-year peak on chatroom-driven demand.

The precious metal is still up by 3.8 percent over the last three days.

Asian and European stocks fired higher once again, after overnight Wall Street gains, as investors got back in the saddle following last week's global rout to snap up bargain shares.

"The new month continues to be good to equities, which have thrown off their late January despair and staged an impressive bounce from the lows of last week," said IG analyst Chris Beauchamp.

New York oil prices surged on the back of upbeat market sentiment and a snowstorm in the northeastern United States.

US benchmark West Texas Intermediate oil soared to $54.91 per barrel, a price last seen on January 24, 2020.

Europe's London Brent North Sea crude hit $57.73, a level last reached nearly a year ago.

"Oil prices powered higher... lifted in part by the positive sentiment returning to equity markets, but mostly because of frigid weather sweeping the United States, pushing up the demand for heating," said OANDA analyst Jeffrey Halley.

The rebound marks a stunning turnaround for the oil market, which briefly turned negative early last year, as the deadly Covid-19 outbreak shuttered economies and companies worldwide.

But BP shares nonetheless tanked by 3.4 percent Tuesday after the energy major revealed that it slumped into an annual net loss of $20.3 billion (16.8 billion euros) on coronavirus fallout.

On the US stimulus front, President Joe Biden on Monday held a meeting with Republican lawmakers to discuss their stimulus counter-proposal as he looks to push through a bipartisan deal.

The $600 billion plan backed by Republicans is less than a third of one put forward by the White House, and includes smaller handouts and no provision for state and local governments -- two issues that Democrats are likely to reject.

While investors' mood was a lot lighter than last week, the ever-present shadow of the coronavirus, along with stuttering vaccine rollouts and spiking infections, continues to persist and keep gains in check.

Elsewhere, fears about the social media-led retail investor battle with Wall Street hedge funds appeared to be abating.

London - FTSE 100: UP 0.6 percent at 6,507.18 points

Frankfurt - DAX 30: UP 1.3 percent at 13,795.01

Paris - CAC 40: UP 1.8 percent at 5,557.22

EURO STOXX 50: UP 1.6 percent at 3,585.89

Tokyo - Nikkei 225: UP 1.0 percent at 28,362.17 (close)

Hong Kong - Hang Seng: UP 1.2 percent at 29,248.70 (close)

Shanghai - Composite: UP 0.8 percent at 3,533.68 (close)

New York - Dow: UP 0.8 percent at 30,211.91 (close)

Euro/dollar: DOWN at $1.2027 from $1.2060 at 2200 GMT

Dollar/yen: UP at 105.00 yen from 104.93 yen

Pound/dollar: UP at $1.3674 from $1.3663

Euro/pound: DOWN at 87.99 pence from 88.27 pence

West Texas Intermediate: UP 2.3 percent at $54.79 per barrel

Brent North Sea crude: UP 2.3 percent at $57.63 per barrel

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