UPDATE 2-Travel stocks soar as encouraging vaccine study lifts Europe

  • Reuters
  • Stock Market News
UPDATE 2-Travel stocks soar as encouraging vaccine study lifts Europe
Credit: © Reuters.

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* Euro zone blue-chips hit highest since March 5

* Italy's Atlantia soars as end of concession dispute nears

* Sweden's SEB slips as loan loss provision surges

* All eyes on ECB meeting, EU summit later this week

(Updates to market close)

By Sruthi Shankar

July 15 (Reuters) - European stocks closed at over a five-week high on Wednesday, with travel stocks surfing a wave of optimism following reports of progress in developing a COVID-19 vaccine.

Hard-hit airline stocks like British Airways-owner IAG ICAG.L , Ryanair RYA.I and Lufthansa LHAG.DE rose between 9.7% and 10.7%, while cruise operator Carnival (NYSE: CCL ) Plc CCL.L jumped 11.4%.

The travel & leisure index .SXTP surged 6.1% to lead sectoral gains, but still remains the worst performer in Europe this year with a 33% plunge as the coronavirus pandemic brought global travel to a halt.

The pan-European STOXX 600 .STOXX rose 1.8%, closing just short of levels last seen in early March, while euro zone blue-chips .STOXX50E jumped 1.7% to hit their highest level since March 5.

Investors were encouraged by an early-stage study on U.S. biotech firm Moderna Inc's MRNA.O experimental vaccine for COVID-19 that provoked immune responses. AstraZeneca AZN.L jumped 5.2% after a report said positive news on the University of Oxford's potential COVID-19 vaccine that has been licensed to the drugmaker could be announced as soon as Thursday. central scenario is that a vaccine would be broadly available from the second quarter of next year, or the fourth quarter of this year in our upside scenario," Mark Haefele, chief investment officer of UBS Global Wealth Management, told clients.

"Various potential treatment options are also in the pipeline, raising hopes that societies can cope with the pandemic without full shutdowns."

Expectations were also high among investors heading into an EU summit later this week that leaders will agree on a recovery fund of 750 billion euros for pandemic-hammered economies. European Central Bank concludes its policy meeting on Thursday although no major announcements are expected. individual movers, Swedish telecom operator Tele2 AB TEL2b.ST gained 2.9% as it reaffirmed its 2020 earnings outlook and plans for an extra shareholder payout. world's largest fish farmer Mowi ASA MOWI.OL jumped 6.8% as harvest volumes beat its own forecast. Shares in peer Salmar SALM.OL rose 2.2%. top gainer on the STOXX 600 was Atlantia SpA ATL.MI , which shot up 26.7% after the Italian infrastructure group and its unit Autostrade made the government new offers to settle their long-running dispute. equipment maker ASML Holding NV ASML.AS declined 3.7% as it reported quarterly profit below estimates, but forecast overall growth for 2020. bank SEB AB SEBa.ST fell 1.6% after reporting a smaller-than-expected fall in net quarterly profit, but credit loss provisions surged. Handelsbanken AB SHBa.ST also dropped 2.6%.

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