Travel stocks lift European shares as recovery hopes return

[August 24, 2021]  (Reuters) -European stocks extended their gains on Tuesday after a full U.S. approval of a COVID-19 vaccine boosted Wall Street to record highs, while data outlined a stronger-than-expected economic recovery in Germany.

The pan-European STOXX 600 index rose 0.1%, following a selloff last week that knocked it off record levels.

The list of gainers was topped by travel & leisure stocks , up 1.5%, followed by automakers and miners.

The Nasdaq hit an all-time closing high on Monday after U.S. health regulators granted full approval to the COVID-19 vaccine developed by Pfizer Inc and BioNTech SE in a move that could accelerate U.S. inoculations.

Global stocks wobbled last week after data from U.S. and Asian economies signalled a slowing global economic recovery, as a spike in the Delta variant of the coronavirus prompted fresh restrictions in several parts of the world.

Investors are awaiting U.S. Federal Reserve chief Jerome Powell's speech at the annual Jackson Hole symposium on Friday for hints on the central bank's asset purchases tapering plans.

"Since the release of the Fed minutes last week, the consensus for the start of tapering has moved slightly forward, from the beginning of 2022 to December 2021," Unicredit analysts said.

"A hawkish surprise from Jackson Hole appears less likely and the next topic of major relevance is probably the U.S. labour market report on Sept. 3."

Meanwhile, data showed Germany's gross domestic product grew by 1.6% on the quarter from April to June, slightly up from its previous estimate of 1.5%, helped by private consumption and state spending.

Marks and Spencer Group rose 4.6% after Berenberg and Credit Suisse raised their price targets on the UK retailer's stock.

"Despite it being a moderate environment for UK consumption ... M&S is enjoying favourable positioning, market share gains from peers disappearing," Credit Suisse analysts said.

Norwegian salmon farmer Bakkafrost gained 1.3% following its second-quarter results.

Novartis slipped 0.8% after the Swiss drugmaker said its Kymriah CAR-T therapy did not meet the primary endpoint in a late-stage study.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Shounak Dasgupta)

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