Results are expected on Friday from a referendum that if passed will allow the Irish government to ratify the European Union's fiscal treaty, a pact designed to bind Ireland and other debt-laden nations that use the euro to tighter spending limits.
Rejection could block Ireland from tapping loans from the EU's rescue fund in 2013 when Ireland's current supply of bailout cash runs out. Polls during the campaign pointed to the treaty's approval.
Britain's FTSE 100 rose one per cent to 5,349.32 and Germany's DAX added 0.5 per cent to 6,313.30. France's CAC-40 rose 0.7 per cent to 3,036.47.
Spain's banking system is under strain a week after Bankia, its fourth-largest bank, required $US23.8 billion ($A24.40 billion) in government aid to cover souring real estate loans.
Investors are increasingly worried that problems might surface at other Spanish banks. Many lent heavily during the nation's real estate bubble and losses from the real estate crash might be too big for Spain's government to shoulder.
"The Spanish banks are in trouble because of real estate loans. And the hole is so big that the Spanish government will find it difficult to save the Spanish banks without blowing a big hole in its budget," said Francis Lun, managing director of Lyncean Holdings in Hong Kong.
Another negative signal came from the European Central Bank, which said Spaniards pulled billions in deposits out of their banks last month, raising concerns of a larger bank run.
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