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* STOXX 600 marks best day in nearly 3 weeks
* Automobiles, chemicals best performing sectors
* Morrisons tops STOXX 600 after surprise bid
* BoE decision awaited this week
(Updates to market close)
By Sagarika Jaisinghani and Ambar Warrick
June 21 (Reuters) - European stocks rose on Monday, led by
growth-exposed sectors as encouraging comments from central bank
head Christine Lagarde boosted optimism over a speedy economic
recovery this year.
The pan-European STOXX 600 index ended 0.7% higher
at 455.23 points after falling to its lowest since June 3
earlier in the session. The index also marked its best day in
nearly three weeks.
Automobile and chemical stocks were the top
gaining sectors, while basic resources surged 1.3% from
a near three-month low.
The STOXX 600 extended gains after Lagarde said euro zone
economic growth could rebound quicker than expected as consumers
begin spending again. She also reiterated that the European
Central Bank would maintain accommodative policy.
Her comments helped markets move further past concerns over
policy tightening by the Federal Reserve, which had cut short a
four-week rally in European shares.
"We believe the Fed’s new outlook will not translate into
significantly higher policy rates any time soon," BlackRock
analysts said in a note.
"Within equities, we have been warming up to cyclical stocks
as the (economic) restart broadens globally, as reflected in an
overweight call on UK equities and our upgrading of European
equities to neutral earlier this year."
The benchmark STOXX 600 scaled record highs this month after
the ECB, in stark contrast to the Fed, said it was premature to
discuss tapering its pandemic-era monetary stimulus.
Focus is now on business activity data from across the euro
zone, due later in the week, for clues on whether a recent surge
in inflation will persist.
Industrial stocks have risen in recent months on positive
indicators from manufacturing activity in the bloc.
London's FTSE 100 rose 0.6%. The Bank of England is
expected to keep interest rates at a record low when it convenes
on Thursday.
Shares in Morrisons, Britain's fourth largest grocer
by sales, surged 34.6% to the top of the STOXX 600, after it
rejected an offer worth 5.52 billion pounds ($7.62 billion) from
private equity firm Clayton, Dubilier & Rice.
Rivals Tesco and Sainsbury's rose 1.7% and
3.8%, respectively.
Italian-American vehicle maker CNH Industrial rose
0.8% after agreeing to a deal to buy Raven Industries
at an enterprise value of $2.1 billion.
German vaccine maker CureVac fell 10.5% after a
report said Germany's financial watchdog was investigating
possible insider trading in the firm's shares, which had
tumbled after the biotech firm announced its COVID-19 vaccine
proved only 47% effective.
(Reporting by Sagarika Jaisinghani in Bengaluru; Editing by
Shounak Dasgupta and Angus MacSwan)
