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* Banks hit three-week high as yields rise
* UK midcap stocks surge as Brexit hopes grow
* Logitech slides as Apple removes rival products
(Updates to market close)
By Sruthi Shankar
Oct 6 (Reuters) - European stocks stretched their gains for
a fourth session on Tuesday, with banks surging more than 3%
over growing hopes for a U.S. stimulus package, a Brexit trade
deal as well as upbeat German data.
After shedding as much as 0.5% at one point, the
pan-European STOXX 600 index gradually erased the
losses to close 0.1% higher.
Europe's banking index hit its highest level in
almost three weeks, as rising U.S. Treasury yields - a benchmark
for global borrowing costs - hit multi-month highs, supporting
lenders on both sides of the Atlantic.
Aside from banks, sectors considered more exposed to the
economic cycle, namely travel & leisure, oil & gas
, automakers and insurers, rose between
1% and 2.9%.
Global markets saw a relief rally on Monday on reassurances
about U.S. President Donald Trump's improving health after he
tested positive for COVID-19 last week, as well as political
progress towards more fiscal stimulus measures.
"Stock markets have been dominated by indecision this week,
with the U.S. indices following their European counterparts in
what looks like a distinct end to the 'Trump left hospital'
bounce," wrote IG's Joshua Mahony.
Technology and healthcare stocks, among the
top performers in Europe this year, slid about 0.9%, weighing on
the STOXX 600.
Wall Street technology majors also came under pressure after
news that the U.S. House of Representatives' antitrust report on
Big Tech firms contained a "thinly veiled call to break up" the
companies.
Germany's DAX jumped 0.6% as data showed orders for
German-made goods rose 4.5% in August, more than expected,
boosting hopes for a robust third quarter in Europe's largest
economy after the coronavirus shock.
Britain's midcap index, composed of stocks exposed
to the UK economy, jumped 1.2% after sources told Reuters that
Britain and the EU were close to agreement on reciprocal social
security rights for their citizens after Brexit.
Puma slid 1.1% after French luxury group Kering
said it had completed the sale of a 5.9% stake in the
German sportswear group.
Swiss technology accessories maker Logitech fell
5.1% after Apple stopped selling headphones and
wireless speakers from rivals.
French waste and water firm Suez jumped 4.6% after
rival Veolia succeeded in buying a large stake in the
company from power group Engie.
(Reporting by Sruthi Shankar in Bengaluru; Editing by
Uttaresh.V and Pravin Char)