UPDATE 2-European shares end near 3-week high as auto, travel sectors rally

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* Carmakers surge as China auto sales surge in July
* German online retailer Zalando gains on upbeat sales
* Markets shrug off weak UK employment report
* German investor sentiment improves in August- ZEW
Institute

(Adds comment, updates price)
By Sruthi Shankar
Aug 11 (Reuters) - European stocks hit a near three-week
high on Tuesday, as U.S. stimulus bets and encouraging data out
of China and Germany galvanised growth-linked cyclical sectors
like travel and leisure, banking and automakers.
The pan-European STOXX 600 index .STOXX closed 1.7%
higher, with Wall Street's S&P 500 .SPX coming in close
quarters with an all-time high as investors hoped for more U.S.
fiscal stimulus. .N
Carmakers .SXAP surged 4.4% in Europe after data showed
China's auto sales climbed 16.4% in July, the fourth straight
month of gains as the world's biggest vehicle market comes off
lows hit during the coronavirus lockdown. Other hard-hit sectors like travel & leisure .SXTP , oil &
gas .SXEP and banks .SX7P jumped between 3.7% and 4.5%.
Unprecedented monetary and fiscal stimulus, hopes of a
COVID-19 vaccine and Europe's relative success in limiting the
spread of coronavirus have helped the STOXX 600 climb 38% from
its March lows, but remains about 15% below its record highs.
"There has been a decent tick-up in economic growth
momentum, and earnings for some of the cyclical sectors have
come in better than expected," said Paul Danis, chief global
strategist at wealth manager Brewin Dolphin.
"There is a good reason to believe that some of the
beaten-down value names could pick up. But it does make sense to
have bias for the mega-cap growth names."
A ZEW survey showed investor sentiment in Germany picked up
more-than-expected in August, reflecting hopes that Europe's
biggest economy is on the road to recovery. The upbeat global mood helped investors look past data
showing the number of people in work in Britain suffered the
biggest drop since 2009 in the three months through June.
Holiday Inn-owner InterContinental Hotels IHG.L gained
4.8% as it saw some "very early" signs of a recovery in demand,
but its profit slumped 82% in the first half of 2020.
German online fashion retailer Zalando SE ZALG.DE rose
1.9% after reporting a more than doubling of sales on its site.
Of the 240 companies in the STOXX 600 that have reported
second-quarter earnings so far, 60.4% topped analysts'
estimates, according to Refinitiv Eikon data. In a typical
quarter, half beat estimates.
Banco BPM BAMI.MI surged 6.9% on expectations that Italy's
third-largest bank could become involved in a possible merger.
Defensive sectors like real estate .SX86P , utilities
.SX6P , healthcare .SXDP and food & beverage .SX3P -
considered more stable during an economic crisis - posted
smaller gains.