(Bloomberg) -- European equities hit their highest closing level in two weeks, ending the session just above a key resistance level, as Germany extended a jobs support program and ahead of the Jackson Hole symposium of central bankers.
The Stoxx Europe 600 Index gained 0.9%, closing above its 200-day moving average for the first time in two weeks. Real estate, tech and mining shares led the gains. The DAX added 1% after Germany allocated around $12 billion more to a program that’s kept millions of people from unemployment.
European stocks have been range-bound since early June as optimism about an economic recovery has been tempered by rising coronavirus cases and trade tensions. Investors may get fresh policy clues from the U.S., with Fed Chairman Jerome Powell due to speak Thursday at the Jackson Hole conference, being held virtually this year because of the pandemic.
Among sectors, technology was among the best performers after U.S. business software giant Salesforce.com Inc. soared as its quarterly profit topped estimates. Energy shares underperformed as Hurricane Laura was set to hit the U.S. Gulf Coast, keeping some of America’s largest refineries shut for months.
Bank of America noted European coronavirus infections have continued to rise, but said it doesn’t expect a second wave of cases to derail a recovery in shares as local restrictions and mask requirements curb new outbreaks. European equities have not yet fully reflected a strong rebound in purchasing managers index data, according to strategist Milla Savova.
“If bond yields continue rising in response to a maturing macro recovery, this should finally allow yield-sensitive cyclicals in the equity market, like banks and value versus growth, to participate in the recovery pricing,” Savova said by email.
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