European Stocks Recover as Bond Markets Stabilize

European stocks rose today after heavy losses incurred last week in light of the decline in sales in the bond markets, as well as boosted sentiment optimism about vaccination campaigns to prevent Covid-19 and a US stimulus package.

The pan-regional STOXX 600 index rose 1.6%, following strong gains for Asian stocks despite weaker than expected industrial activity data in China.

The benchmark European stock index fell to close to its lowest level in a month on Friday with growing investor fears of a high rate of inflation due to another huge US stimulus package, and the reopening of the global economy may push major central banks to tighten monetary policy.

The German DAX index rose 1.3%, while the French CAC 30 index and the British Financial Times 100 index each gained 1.5%.

Mining sector shares rose 2.2%, the biggest gainer among the sectors, and travel, entertainment and retail companies jumped more than 2%.

IAG, which owns British Airways, was the biggest gainer on the STOXX 600, gaining 5.4%, after Bill Hunt upgraded the stock to a “buy” rating, thanks to expectations of a recovery in travel demand over the summer.