LONDON, July 2 (Reuters) - European equities ended at a two-month closing high on Monday as investors beefed up their anaemic holdings in anticipation of further action from policy makers after an EU deal aimed at tackling the region's crisis last week.
Investors came back to European equities after a negative second quarter with the agreement reached last Friday at an EU summit, which included allowing the euro zone bailout fund to inject money directly into struggling banks, expected to pave the way for more monetary stimulus from the European Central Bank.
The pan-European FTSEurofirst 300 index provisionally closed 1.2 percent higher at 1,033.77 points.
"We're in a bottoming out process...but I think there will be a lot of volatility over the next few months as the market keeps the pressure on," Trevor Greetham, director of asset allocation at Fidelity Worldwide Investment, said.
"The market will want to pressurise policy makers into providing more stimulus and into being much clearer about when European banks can be recapitalised and when there will be intervention in the sovereign bond market."