STOXX 600 jumped 0.7% as stock markets in Germany, London and France gained
European stocks closed higher on Wednesday following new record highs for Wall Street’s main indexes, while UK airlines rallied on hopes of a shorter quarantine period for travellers.
After a feeble start, the pan-European STOXX 600 climbed 0.7%, with stock markets in Germany, London and France all gaining ground.
British Airways-owner IAG surged 7.6% and easyJet rose 3.3% on news that Britain’s government was working with Heathrow Airport on a plan to use Covid-19 testing to help shorten quarantine times.
The travel sector has come under pressure as several countries in Europe have imposed new travel curbs because of a pick-up in coronavirus cases.
A full-blown lockdown looks unlikely, Andrew Kenningham, chief Europe economist at Capital Economics wrote in a note. The second wave will hold back the recovery, but it will probably not cause another deep recession.
Danish shipping group Maersk, a bellwether for global trade, issued forecast-beating full-year earnings and said it expected demand for moving containers at sea to return to pre-Covid levels in the first half of next year. Its shares jumped 5.0%.
Trillions of dollars in stimulus and a rally in technology stocks drove the S&P 500 to new record highs, with Apple becoming the first publicly-listed US company to record US$2 trillion in market capitalisation.
The US Federal Reserve’s minutes from its latest policy meeting are due later on Wednesday, with investors looking for clues on further action that the US central bank could take in September.
Investors were unfazed by data that showed a measure of euro zone inflation surged in July, surprising many economists who interpreted the figure as “almost certainly more noise than signal.”
Brewery Royal Unibrew jumped 9.8% to the top of STOXX 600, after it raised its 2020 earnings forecast.
Utilities took a hit as RWE fell 4.6% as the German company launched a share issue to finance its purchase of wind turbine maker Nordex’s project development pipeline.
Finland’s biggest utility Fortum slid 4.9%, as it reported an 11% fall in its underlying second-quarter operating profit.
The biggest decliner on the STOXX 600 was Belgian biotech company Galapagos, which slumped 24.4% after US health regulators rejected its lead product filgotinib to treat rheumatoid arthritis.