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UPDATE 2-European shares extend rally on vaccine cheer, ECB comments

Published 11/11/2020, 05:59 PM
Updated 11/12/2020, 01:30 AM
© Reuters.

(For a Reuters live blog on U.S., UK and European stock
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* Spain, Italy to get COVID-19 vaccines by early 2021
* ECB eyes more bond buys, cheap loans -Lagarde
* ABN Amro drops on cautious outlook
* Nordea Bank falls on stake sale by Finnish insurer Sampo

(Updates prices throughout, adds comments)
By Shashank Nayar and Shreyashi Sanyal
Nov 11 (Reuters) - European shares rose for a third straight
day on Wednesday as optimism around a potential COVID-19 vaccine
and encouraging comments from European Central Bank chief
Christine Lagarde offset worries of economic damage from surging
The pan-European STOXX 600 .STOXX jumped 1%, building on a
6% rally this week as investors bought into utilities .SX6P as
well as travel-related stocks .SXTP , a sector that has widely
underperformed this year.
Technology stocks .SX8P , which have tracked a surge in
their U.S. counterparts since the coronavirus-driven crash in
March, gained 2%.
The benchmark STOXX 600 has surged nearly 45% since March,
thanks partly to historic global stimulus, but it is still down
6.5% on the year as the resurgence in COVID-19 cases threatens a
nascent economic recovery.
By comparison, the U.S. benchmark S&P 500 .SPX has risen
nearly 10% this year and was propelled to record highs this week
after drugmaker Pfizer Inc PFE.N said its COVID-19 vaccine was
90% effective.
ECB President Christine Lagarde said the central bank will
focus on more emergency bond purchases and cheap loans for banks
when it puts together its new stimulus package next month.
Lagarde "gave a clear message that encouraging news about a
vaccine would not stop the bank from loosening policy in
December," said Jack Allen-Reynolds, senior Europe economist at
Capital Economics.
Spain, which has been among the countries hit hardest by the
health crisis, will get its first vaccines in early 2021, while
Italy expects to receive an initial 3.4 million shots in
January. Meanwhile, the European third-quarter earnings season has
been largely better than expected, with about 68% of the STOXX
600 companies that have reported so far beating estimates,
according to Refinitiv data.
E.ON EONGn.DE , Germany's largest energy firm, gained 1%
after it said demand had recovered faster than expected from the
coronavirus crisis, while maintaining its 2020 forecast.
German auto supplier Continental CONG.DE fell 0.8% as it
warned of further restructuring expenses in the fourth quarter.
Dutch bank ABN Amro ABNd.AS slid 5.6% as it remained
cautious despite reporting a much better-than-expected quarterly
profit. European banks .SX7P rose 0.2%.
Nordea Bank NDASE.ST fell 5% after Finnish insurer Sampo
SAMPO.HE said it had sold 4% of the share capital in the bank
in an accelerated bookbuild offering to institutional investors.
Among country indexes, German stocks .GDAXI rose 0.4%,
while London's FTSE 100 .FTSE and France's CAC 40 .FCHI
added 1.4% and 0.5%, respectively.

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