* Bank stocks at 15-month high
* Insurers, financial service sectors lead gains
* Travel and leisure stocks best weekly performers
(Adds comments, updates prices throughout)
By Ambar Warrick and Shreyashi Sanyal
May 28 (Reuters) - European shares rose to a record high on
Friday as British-exposed financial stocks gained following a
hawkish comment from a Bank of England official, with the
prospects of increased U.S. fiscal spending boosting market
sentiment.
The pan-European STOXX 600 index rose 0.6% to a
record high of 448.98 points and added 1% this week.
The Europe-only STOXX index and the European blue
chip index added about 0.7% each, trading just below
multi-year highs.
Bank stocks rose 0.4% to a 15-month high, tracking a
rise in euro zone bond yields. British lenders, including HSBC
, led the gains after a Bank of England policymaker
suggested an earlier-than-signalled hike in lending rates.
Gains in British-exposed stocks supported the insurance
and financial services sectors, which were the
best performing sectors for the day.
Optimism over economic growth has supported European stocks
this year, with several economies loosening their COVID-19 curbs
against the backdrop of a steady vaccination campaign.
The reopening measures have boosted the travel and leisure
stocks, which outpaced their regional peers this week
with a 4% jump.
"With May all but over apart from next Monday ... the month
is ending on a positive note, as strong momentum continues to
carry markets higher while investors learn to acclimatise to an
environment of higher inflation," said Chris Beauchamp, chief
market analyst at IG
Data showed economic sentiment improved by more than
expected to a three-year high in May, with the strongest gains
in services, retail and among consumers as governments eased
pandemic restrictions.
German stocks added 0.7%, as the country planned to
offer adolescents COVID-19 vaccine shots from early-June.
Markets also took comfort in the prospect of more liquidity,
after a report said U.S. President Joe Biden will seek $6
trillion in federal spending for 2022. Biden is expected to
unveil his first full budget later in the day.
Data showed U.S. inflation jumped in April, but Wall Street
shrugged off the rise in prices.
"After reacting dramatically to signs of higher prices
earlier in the year the boil has firmly come off the inflation
story, markets apparently now able to take readings like today's
PCE in their stride," Beauchamp said.
Among individual movers, Spanish bank Sabadell
fell more than 6.5% even after it outlined plans for more cost
cuts to improve profitability.
French planemaker Airbus extended solid gains from
Thursday, hitting a near 15-month high after it outlined plans
to nearly double output.
(Reporting by Ambar Warrick and Shreyashi Sanyal in Bengaluru;
Editing by Arun Koyyur and Alison Williams)