MILAN: European shares rose on Monday as progress on a possible Covid-19 vaccine, some upbeat earnings reports and stimulus talks fed into hopes of an economic recovery from the coronavirus-induced downturn.
The pan-European STOXX index rose 1%, with miners gaining 1.7% on optimism over China's recovery and surging metal prices.
Other growth-oriented sectors such as travel & leisure, banks, technology stocks and oil & gas rose between 1.9% and 1.4%.
Two experimental coronavirus vaccines by German biotech firm BioNTech and US pharmaceutical giant Pfizer have received the US Food and Drug Administration's "fast track" designation, the companies said on Monday.
"The sooner a vaccine comes out the more confident economies can get about opening up completely and start to get on the road to recovery," said Michael Baker, analyst at ETX Capital in London. He added that optimism also stems from the fact that the companies involved are ones with the capacity to mass-produce.
Shares of BioNTech's depository receipt on the Frankfurt exchange jumped 13.5%.
Companies listed on the STOXX 600 are expected to report a 54% drop in second-quarter profit, the worst ever reading for Europe, according to Refinitiv data.
Nordic bank DNB rose 9.9% after an earnings beat, while private security company G4S gained 9.3% on announcing that first-half profit would surpass expectations.
In other company news, Finnish valves maker Neles surged 37.6% and hit a record high after Swedish industrial group Alfa Laval announced a recommended 1.73 billion euro ($1.96 billion) cash bid.
Meanwhile, Atlantia slumped 15.2% after Italy's prime minister dismissed the toll road operator's bid to keep its lucrative toll road concession.
French video games group Ubisoft fell 5% as it announced staff departures after a review in response to allegations of misconduct at the company.
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