European Shares Rally As Fed Ramps Up Support Measures

European stocks rallied on Tuesday after the U.S. Federal Reserve outlined plans to buy individual corporate bonds to help prop up the economy amid the coronavirus pandemic.

Also, worries about a second wave of coronavirus infections eased as mainland China reported 40 new confirmed coronavirus cases for June 15, down from 49 a day earlier.

Investors also cheered reports suggesting that the Trump administration is weighing up a US$1 trillion infrastructure spend to spur on the economy in the wake of the coronavirus crisis.

Earlier today, the Bank of Japan increased the nominal size of its lending packages for cash-strapped firms to $1 trillion from about $700 billion announced last month.

The pan European Stoxx 600 climbed 2.3 percent to 361.16 after declining 0.3 percent in the previous session.

The German DAX jumped 2.8 percent, France’s CAC 40 index rallied 2.2 percent and the U.K.’s FTSE 100 was up 2.1 percent.

Airbus advanced 3 percent. Budget airline easyJet said it would take delivery of 24 Airbus planes between 2025 and 2027. easyJet shares surged 7 percent.

Shares of TUI Group soared 7.6 percent after the tour operator announced its plans to partially restart its Summer 2020 program with easing of travel restrictions in Europe.

Deutsche Telekom shares rose over 2 percent after SoftBank Group Corp. said it would explore potential transactions of T-Mobile US Inc. shares.

Deutsche Lufthansa gained 2.7 percent. The airline operator said it is seeking to reach agreements with the representatives of the trade unions by June 22 to cut 22,000 full-time jobs.

Online fashion retailer Zalando slumped 5 percent after a stake sale by Swedish investment firm Kinnevik AB.

Smith & Nephew rose over 2 percent. The medical equipment manufacturing company said its REGENETEN Bioinductive Implant has received CE Mark certification.

Industrial equipment rental company Ashtead Group jumped 8.2 percent. The company maintained its dividend despite reporting a sharp fall in its fourth-quarter profit.

Cineworld Group shares advanced 5.3 percent. The cinema operator plans to reopen cinemas across some territories during the last week of June, with all theatres expected to be open over the course of July.

In economic releases, German investor sentiment rose more than expected in June on hopes that the economy will bottom out by summer 2020, a survey showed.

The ZEW research institute’s economic sentiment index rose to 63.4 from 51.0 in May. Economists had expected a reading of 60.0

The U.K. jobless rate was unchanged from the previous quarter, while earnings growth slowed sharply in the three months to April, when the economy entered a lockdown for a large part to slow the spread of the coronavirus, preliminary data from the Office for National Statistics showed.

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