European Shares Rally On Stimulus Optimism

European stocks rallied on Wednesday to extend gains from the previous session amid hopes that Japan and Europe will unveil large stimulus packages to minimize the economic fallout due to the coronavirus pandemic.

The Japanese government is likely to inject a fresh stimulus package worth $1.1 trillion on top of a $1.1 trillion package already rolled out by the government last month.

The European Commission is due to present its proposal for a bailout package, potentially backing efforts by France and Germany for a 500 billion-euro ($547 billion) fund to aid recovery efforts.

European Central Bank President Christine Lagarde said on a question and answer session today that the euro zone economy is likely to shrink between 8 percent and 12 percent this year.

The pan European Stoxx 600 rose about 1 percent to 352.30 after climbing 1.1 percent on Tuesday. The German DAX jumped 1.7 percent, France’s CAC 40 index rallied 1.9 percent and the U.K.’s FTSE 100 was up 1.5 percent.

Finnish tyre maker Nokian Tyres soared 17 percent after naming a new chief executive officer.

Lender Commerzbank surged 7.7 percent after launching a program to issue additional tier 1 (AT1) capital.

Property company LEG Immobilien rose about 1 percent on reports it is in talks with rival TAG Immobilien AG about a potential merger.

Travel operator TUI AG jumped 23 percent after Spain urged foreign visitors to return starting in July.

easyJet rose 1.2 percent and International Consolidated Airlines Group advanced 6 percent.

Investment trust Caledonia Investments gained 2 percent after raising its dividend.

Britvic surged 4.6 percent. The producer of soft drinks said that it is “confident” in its long-term strategy following the pandemic.

Swiss drug maker Roche declined 1.4 percent. Chief Executive Severin Schwan said the company is looking beyond cancer drugs to fresh treatment areas.

Chipmaker Infineon Technologies gave up 1.9 percent after it raised about 1.06 billion euros ($1.16 billion) by issuing new shares.

Sika AG lost 5.4 percent after French building-materials maker Cie. de Saint-Gobain sold a near 11 percent stake worth 2.56 billion Swiss francs in the Swiss specialty chemical company.

Property development and investment company Hammerson fell 2.6 percent after its CEO David Atkins resigned.

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