* STOXX 600 hits 20 month high
* AMS jumps after results
* Dior up after buyout deal (Adds detail and quotes, updates prices)
By Kit Rees
LONDON, April 25 (Reuters) - Deal-making and earnings underpinned European stock markets on Tuesday as the focus shifted back to fundamentals and away from politics, for now, with the pan-European STOXX 600 index scoring its fifth straight session of gains.
The STOXX 600 ended up 0.2 percent, after briefly hitting its highest level since August 2015 during the session. It is up 7.1 percent so far this year.
A win for centrist candidate Emmanuel Macron in the first round of the French presidential election sparked a global rally in risk assets on Monday as investors breathed a sigh of relief over the reduced chances of a nationalist upset.
"You've got all these positive factors in Europe's favour, but the problem is of course that we have had some political road bumps to contend with this year," Ken Odeluga, market analyst at City Index, said.
"That is the main cautionary factor that is this fly in the ointment for what are a positive set of circumstances overall."
Figures from Thomson Reuters Lipper showed that net flows into European mutual funds posted their third straight monthly inflow in March with up to $100 billion of inflows potentially in the pipeline. Investors are buying into the improving economy and taking heart from the more favourable political landscape.
France's CAC 40, which rallied more than 4 percent on Monday, ended up 0.17 percent.
Earnings were firmly in focus, with shares in AMS surging 19.6 percent to a record high after the chipmaker reported first quarter revenues above its own forecast and added that it might raise its mid-term revenue growth target.
Well-received earnings also boosted shares in auto stock Volvo, which rose 7.6 percent after beating first quarter forecasts.
M&A action also fuelled shares, with luxury goods firm Christian Dior rocketing 11 percent to touch a fresh all-time high after a buyout deal.
LVMH and billionaire businessman Bernard Arnault announced a deal to simplify their relationship with Christian Dior by buying out its minority shareholders, aimed at boosting LVMH's earnings.
LVMH shares hit a record level and rose 3.9 percent higher, while rival Hermes fell 4.5 percent.
Results, however, weighed on Swedish mining and smelting firm Boliden, which fell 6.6 percent.
Boliden's core operating profit missed forecasts by 6 percent. It blamed a fall in volume of free metals at copper smelters from unusually high levels seen in the previous quarter.
Shares in Whitbread also dropped, down 7.1 percent after the Costa Coffee owner reported results and said that it expected consumer confidence to wane next year. (Reporting by Kit Rees and Danilo Masoni; editing by Mark Heinrich)