Blue-chip earnings, travel stocks boost European shares



(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window)

* ASML nears record high after results

* STOXX 600 Q2 profit seen rising 115%

* SAP slips despite forecast lift (Updates to close)

By Sruthi Shankar

July 21 (Reuters) - A slew of upbeat updates from European blue-chip firms helped the region's benchmark index posts its best session in 11 weeks on Wednesday and further recover from Monday's sharp losses, while travel stocks roared back after weeks of declines.

The pan-European STOXX 600 index .STOXX rose 1.7%, extending Tuesday's small gains. Travel and leisure stocks .SXTP jumped 3.7% after getting hammered recently by worries about a resurgence in COVID-19 cases.

Dutch semiconductor equipment maker ASML Holding ASML.AS rose 3.1% and neared all-time highs after it raised its 2021 sales outlook and announced a new share buyback plan.

Shares in peers ASM ASMI.AS and BE Semiconductor BESI.AS rose about 3% each.

Leading the STOXX 600 risers was Swedish transportation equipment maker Thule THULE.ST after a second-quarter beat, while British fashion retailer Next NXT.L jumped 7.5% on lifting its profit forecast.

A rise in hammered bond yields helped banks .SX7P post their best session in more than four months.

Investors expect the European Central Bank to stick to a dovish tone at its policy meeting on Thursday, with investors looking for clues on what to expect in the September meeting. Earlier this month, it had unveiled a new strategy where it will tolerate higher inflation by targeting 2% inflation.

"The ECB dovish bias would suggest that the total reduction of the monthly purchases in 2022 will be less than previously expected," said strategists at ING.

European companies listed on the STOXX 600 are expected to post a 115.2% jump in second-quarter profit versus a year ago, as per Refinitiv IBES data. While forecast for profit growth has consistently risen, many expect growth rate to peak in the second quarter.

The upbeat earnings reports helped investors look past worries about cooling global growth as many parts of Asia, Europe and the United States grappled with surging cases of the Delta variant.

"In the case of the likes of the UK and U.S. where vaccination levels are much higher, markets are banking that the vaccine wall holds back the virus enough not to overwhelm the respective healthcare systems of both countries," said Michael Hewson, chief market analyst at CMC Markets.

Europe's most valuable tech company, SAP SAPG.DE , dropped 3.2%, with investors disappointed that revenue and profit outlook had not been lifted further. Swiss drugmaker Novartis NOVN.S fell 0.7% despite second-quarter core net income beat.



STOXX 600 on pace to recover from Monday's rout Link



Reporting by Sruthi Shankar and Susan Mathew in Bengaluru;
Editing by Arun Koyyur and Pravin Char

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.