• The pan-European Stoxx 600 ended Thursday's session up by about 1.2% provisionally, with autos jumping 1.8% to lead gains.
• British travel booking site Trainline plunged 23% to the bottom of the Stoxx 600 as the U.K. government prepared to announce a long-awaited overhaul of the rail system.

LONDON — European stocks closed higher Thursday, as investor appetite for riskier assets returned after a wave of selling in the previous session.

The pan-European Stoxx 600 ended Thursday's session up by about 1.2% provisionally, with autos jumping 1.8% to lead gains as almost all sectors and major bourses ended in positive territory.

Investors are taking on more risk after a market sell-off on Wednesday. The Stoxx 600 closed down 1.5% in the previous session, while on Wall Street the major U.S. indexes also finished Wednesday's trading session in the red amid a plunge in cryptocurrency prices.

On Thursday, both U.S. stocks and cryptocurrencies were higher. The Dow Jones Industrial Average climbed 300 points while the Nasdaq and S&P 500 were also positive. Bitcoin, meanwhile, bounced back above $42,000 Thursday morning.

The labor market picture stateside received another boost Thursday as the Labor Department reported that initial jobless claims last week totaled a fresh pandemic-era low of 444,000, below the 452,000 expected by economists polled by Dow Jones.

On Wednesday, global investors also digested the Federal Reserve's minutes from April that hinted at considering tapering its asset purchase programs in upcoming meetings.

Earnings in focus

Earnings came from EasyJet, Kingfisher, National Grid, Royal Mail, Manchester United and QinetiQ.

EasyJet posted a fiscal first-half loss of £701 million ($990 million) and vowed to fly 15% of its pre-pandemic schedule in the third quarter as travel restrictions ease between the U.K. and Europe. Shares were down 2%.

"The largest airline company to fly to green list destinations, easyJet is well-positioned to capitalize on the anticipated surge in bookings," said Neil Shah, director of research at Edison Group.

"However, with infection rates rising around some communities in the U.K. and uncertainty surrounding vaccination numbers in some of its destinations, the recovery the company is expecting may be slightly exaggerated."

Royal Mail full-year adjusted operating profit of £702 million, a 116% surge from the previous year. However, it refrained from providing a forecast for the current fiscal year, citing uncertainties. The company's stock price climbed 2.8%.

"The spike in volumes during the pandemic accelerated the trend away from letters and toward parcels at a pace which forced the transformation of the company at lightning speed," said Richard Hunter, head of markets at Interactive Investor.

"Indeed, the company describes the situation as having given it "breathing space" and the scene is now set for the next raft of challenges, which will include the level to which the change in the business mix will stick in a post-pandemic world."

Meanwhile Deutsche Telekom raised its medium-term profit outlook to 3%-5% growth per annum until 2024. The stock was up 2.3%.

In terms of individual share price movement, British travel booking site Trainline plunged 23% to the bottom of the Stoxx 600 as the British government prepares to announce a long-awaited overhaul of the rail system on Thursday.

At the top of the European blue chip index, Swedish investment firm Kinnevik climbed 8.4%.

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-CNBC's Ryan Browne and Yun Li contributed to this market report.