European Shares Rally On Economic Optimism

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European stocks were rallying on Thursday as encouraging news on a vaccine for Covid-19 as well as upbeat manufacturing PMI data across the globe helped revive hopes for a quick economic recovery.

Investors also looked ahead to the U.S. Labor Department’s closely watched monthly employment report for June due later in the day for further clues about the health of the world’s largest economy.

The pan European Stoxx 600 climbed 1.3 percent to 365.69 after closing up 0.2 percent on Wednesday.

The German DAX rose about 2 percent, France’s CAC 40 index gained 1.7 percent and the U.K.’s FTSE 100 was up 0.8 percent.

Travel stocks gained ground in London after reports that dozens of countries will be exempt from a travel quarantine from Monday.

British Airways-owner IAG surged 6.3 percent, while hotel group rallied 3.4 percent and Intercontinental Hotel Group added 3.3 percent.

Primark-owner Associated British Foods jumped 5.4 percent. The company said that trading in its stores that have reopened after coronavirus lockdown has been “reassuring and encouraging”.

Low-cost airline Wizz Air Holdings rose over 2 percent and Ryanair Holdings gained 3.3 percent after unveiling their passenger traffic figures for June.

Meggitt soared 7 percent. The engineering company said that it is experiencing initial signs of recovery in commercial aerospace.

Swiss drug maker Novartis AG shed 0.6 percent after it agreed to pay $678 million to resolve a whistle-blower case in the U.S.

Fashion house Hugo Boss rallied 3 percent after it appointed Tommy Hilfiger executive Oliver Timm as its chief sales officer.

Scandal-hit Wirecard plunged 26 percent. Police and prosecutors have raided the headquarters of the beleaguered payments firm as part of a fraud investigation relating to its £1.7bn accounting black hole.

French electric utility Engie rallied nearly 4 percent. The company has agreed to sell 49 percent equity interest in a 2.3 GW US renewables portfolio to Hannon Armstrong. Engie will retain a controlling share in the portfolio and continue to manage the assets.

On the data front, the euro area unemployment rate rose marginally in May, figures from Eurostat showed.

The unemployment rate climbed to 7.4 percent in May from 7.3 percent in April. In the same period last year, the jobless rate was 7.6 percent.

The number of people out of work increased by 159,000 from April to 12.146 million in May.

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2020-07-02 05:54:12

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