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* Energy stocks post best day in one month
* Travel stocks rebound after four days of losses
* German stocks rise as retail sales bounce
* STOXX 600 within 1% of record high
(Updates to market close)
By Sagarika Jaisinghani and Ambar Warrick
July 1 (Reuters) - European shares ended higher on Thursday
as a rally in crude prices saw energy stocks surge more than 2%,
while strong earnings reports helped dispel some concerns over
the infectious "Delta" variant of the coronavirus.
The pan-European STOXX 600 closed 0.6% higher at
455.63 points, with energy stocks marking their best day
in one month. Energy services provider TechnipFMC Plc
was the top gainer in the sector, adding 4.4%.
Oil prices rose almost $2 on the prospect of increasing
global demand, while lower U.S. crude stocks helped. Reuters
also reported that OPEC would hike production by less than
expected, which could result in a supply shortfall and support
oil prices later this year.
"This approach comes amid a spreading Delta variant, which
is still impacting mobility in certain geographies. Separately,
Washington's negotiations with Iran could also quench a
substantial portion of expected deficits down the road,"
analysts at TD Securities wrote in a note.
"A Summer Breakout in energy markets can continue to gather
steam with supply artificially constrained."
Travel-related stocks jumped 1.9% after falling for
four days in a row on fears of more restrictions following a
spike in the number of COVID-19 cases in Asia and the United
Kingdom.
Airlines EasyJet, British Airways-owner IAG
and Ryanair rose between 1.5% and 4%.
The STOXX 600 was now within 1% of a record high hit in
June, as growing optimism over a vaccine-led economic recovery
this year saw sentiment jump to a 21-year high.
Figures on Thursday confirmed the euro zone manufacturing
sector expanded last month at its fast pace on record.
Germany's DAX rose 0.5% as data showed retail sales
in Europe's biggest economy rebounded in May.
Technology stocks, which had outperformed through
the pandemic, were the sole losers for the day, down 0.7%.
Investors were likely comfortable in pivoting to sectors more
exposed to an economic recovery.
Associated British Foods rose 4.8% as it said
third-quarter sales at its Primark fashion stores that reopened
after COVID-19 lockdowns were ahead of expectations in all
markets.
French catering and food services group Sodexo
rose 2.3% after boosting its second-half revenue and profit
margin forecasts, betting on the full reopening of U.S. schools.
Sodexo's peer, Denmark's ISS, jumped 6.6% to the
top of the STOXX 600, after the news.
Fashion retailer H&M, on the other hand, fell 1.1%
as its second-quarter earnings remained well below pre-pandemic
levels.
(Reporting by Sagarika Jaisinghani, Julien Ponthus and Ambar
Warrick; Editing by Uttaresh.V and Lisa Shumaker)
