UPDATE 2-Europe's STOXX 600 closes at record high on global recovery optimism

  • Reuters
  • Stock Market News
UPDATE 2-Europe's STOXX 600 closes at record high on global recovery optimism
Credit: © Reuters.

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* STOXX 600 reclaims pre-pandemic highs

* UK cheers reopening plan next week

* Miners, automakers, travel stocks lead gains

* Credit Suisse slips after $4.7 bln hit on Archegos

(Adds comment, updates prices throughout)

By Sruthi Shankar and Shreyashi Sanyal

April 6 (Reuters) - Europe's benchmark equity index closed at a record high on Tuesday, recovering all of its pandemic-driven losses as investors bet on a speedy global economic recovery, spurred by bumper stimulus spending and COVID-19 vaccination programmes.

European traders returned from a long weekend to push the STOXX 600 .STOXX up 0.7% to 435.36 points. It has climbed more than 60% from last year's lows and surpassed its previous all-time high of 433.90 points in February 2020.

The German DAX .GDAXI rose 0.7% to add to its recent record-setting rally, France's CAC 40 .FCHI was up 0.5%, also fully recovering from last year's crash and Britain's FTSE 100 .FTSE jumped 1.3%.

"European equity markets have a higher percentage tilt to the more distressed cyclical and value parts of the market that performed poorly not only in 2020, but for several years before as well," Niall Gallagher, investment director for European equities at GAM wrote in a note.

"Any change in the economic environment that sees a pick-up in growth and a pick-up in inflation is likely to positively impact these sectors and as they are a higher weighting in the market, this explains the recent expectations that European equities may do better in the next few months."

Economically sensitive sectors such as banking, commodity and automakers rebounded strongly this year, boosting European stocks.

However, it took the benchmark seven months more than the U.S. S&P 500 .SPX to reclaim its pre-pandemic high, slowed down by a sluggish vaccination roll-out and a new wave of infections.

Miners .SXPP were the top gainers on Tuesday, up 1.8%, while travel & leisure stocks .SXTP , automakers .SXAP and food & beverage shares .SX3P rose 1.0%.

Data showed, euro zone unemployment was unchanged in February compared with an upwardly revised reading for January, as European furlough schemes limited the impact of the second wave of the pandemic in the fourth quarter on jobs. euro-zone's unemployment rate was unchanged at 8.3% in February despite virus measures being tightened, highlighting the extent to which government policies have protected jobs during the pandemic," said Jessica Hinds, Europe economist at Capital Economics.

Swiss bank Credit Suisse CSGN.S slipped 0.4% after sharp losses last week, as it announced an estimated loss of 4.4 billion Swiss francs ($4.7 billion) from its relationship with Archegos Capital Management. stocks took cheer as British Prime Minister Boris Johnson said the next phase of a planned reopening of the economy could take place next week. .L

BP BP.L gained 3.2% after the oil major said it expected to reach its $35 billion net debt target in the first quarter of 2021. European shares reclaim pre-pandemic levels

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