UPDATE 2-European stocks rack up hefty gains as cyclicals rally

  • Reuters
  • Stock Market News
UPDATE 2-European stocks rack up hefty gains as cyclicals rally
Credit: © Reuters.

(For a live blog on European stocks, type LIVE/ in an Eikon news window)

* U.S. jobs data further spurs demand for risky assets

* Euro zone banks record best week since 2009

* Hugo Boss jumps after confirming talks for new CEO

(Updates to market close)

By Sruthi Shankar

June 5 (Reuters) - European stocks racked up their best week in two months on Friday, with investors scooping up battered shares of banks, automakers and travel companies amid growing signs that the pandemic-hit global economy is recovering.

The pan-European STOXX 600 .STOXX ended the day 2.5% higher, getting an afternoon boost from data that showed U.S. economy unexpectedly added jobs in May after suffering record losses the prior month. zone blue chip stocks .STOXXE jumped 3.8% and the bloc's lenders .SX7E rallied 7.6% for their best weekly gain since 2008's global financial crisis.

Risky assets across the world have been lifted this week as economies continued to emerge from their lockdowns, while a bigger-than-expected stimulus package from the European Central Bank and hopes for European-Union wide fiscal action gave a further boost to the continent's markets.

Growth-sensitive cyclical sectors that have suffered badly during the coronavirus crisis, such as oil & gas .SXEP , automakers .SXAP and travel & leisure .SXTP , were up between 4.9% and 5.8%.

The auto-heavy Germany DAX .GDAXI is just 6.7% away from hitting an all-time high.

"It only takes a small change in sentiment toward these stocks – a glimmer of optimism that the virus is under control or ever increasing stimulus – and investors will question whether the reversal has begun," said Lewis Grant, a senior portfolio manager at Federated Hermes.

"These rallies can become self-sustaining as more investors rush in through fear of missing out," he added.

Analysts at Bank of America (NYSE: BAC ) on Friday forecast European stocks would rise another 10% by the end of September on expectation of a pick-up in business activity. of a revival in tourist traffic helped British Airways owner-IAG ICAG.L jump 13.6%, while shares in easyJet EZJ.L , Lufthansa LHAG.DE and Air France AIRF.PA gained between 5.5% and 12.5%. .L

Airbus AIR.PA rose 12.5% after Australia's Qantas QAN.AX announced plans to reactivate plans to order planes. fashion house Hugo Boss BOSSn.DE was up 11.4% after it confirmed ongoing talks for a new chief executive officer with Daniel Grieder, former head of Tommy Hilfiger Global & PVH Europe. European stocks recover nearly 2/3rd of virus-led losses

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