Banks, automakers drive European stocks higher, EU recovery plan awaited

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European shares edged higher on Wednesday as investors focused on a fresh EU stimulus plan , but renewed U.S.-China tensions over Hong Kong tempered optimism about a global economic recovery.

The easing of lockdowns in many European countries and improving economic data have spurred buying in the growth-exposed cyclical sectors in recent weeks, putting European stocks on course for a modest 2.9% gain in May.

“With the cyclicals, the most extreme risks seem to have been priced in and people are looking for some cheaper opportunities.”

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