European rally from mid-March lows continues after China data and slowing growth in new virus cases

European rally from mid-March lows continues after China data and slowing growth in new virus cases

European stocks were on track for their seventh gain in nine sessions on Tuesday, rising on the belief that the worst economic fallout from the coronavirus outbreak is in sight if still to come.

The Stoxx Europe 600

rose 1.9% and has climbed about 15% from its lows on Mar. 18.

Global new coronavirus case growth was 8.8%, according to Deutsche Bank, the second day in a row it was under 10%. Healthcare giant Johnson & Johnson on Monday said it had a candidate for a coronavirus vaccine that could be ready next year.

Data coming out of China bounced back. The manufacturing purchasing managers index jumped to 52.0 for March, up from 35.7, and the services PMI rose to 52.3 from 29.6. Other measures of Chinese activity aren’t as robust. On Tuesday, for instance, Beijing traffic congestion was 34% lower than usual, according to mapping service TomTom.

“We continue to believe in a China led economic rebound and this process is in its early phases and should amplify helped by some pent-up consumer demand,” said Sebastien Galy, senior macro strategist at Nordea Asset Management.

Shares of prepared food kit maker HelloFresh

rallied 13% as the company said it beat expectations on revenue and adjusted profit due to the coronavirus outbreak. The company said it saw “a further meaningful acceleration since the latter half of March 2020, driven by increased demand due to the heightened public focus on the evolving COVID-19 pandemic.”

Imperial Brands
the cigarette maker, rose 12% as it said the virus hasn’t materially impacted performance.

Royal Dutch Shell

climbed 6% as the oil giant highlighted a new $12 billion credit facility. It said the first-quarter impact from the virus outbreak and the oil-price war was mostly felt in March.

Cosmetics giant L’Oréal

slipped 2.1% after pulling its 2020 financial guidance and saying first-quarter sales fell about 5%.

Chemicals maker Akzo Nobel

slumped 1.5% after saying that it is pausing key part of the company’s transformation strategy and suspending its financial targets.

Crude-oil futures

rose 5% to top $21 a barrel, and U.S. stock futures

also edged higher.

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