Travel, leisure and Evergrande push stocks higher

On Wednesday European stocks gained ground, rebounding from its early-week losses after debtladen developer China Evergrande said it would make some interest payments, while travel and leisure index rose to a 14week high.

Evergrande’s Frankfurt-listed shares gained 24% after reaching multi-year lows in the previous session. The property developer said it would make a coupon payment on its domestic bonds, presenting respite to investors concerned about payments default after financial difficulties.

Boosting the travel & leisure index, Entain gained 6.2% to a life high after the UK gambling firm unveiled a $22.4 billion takeover proposal from Bostonbased DraftKings which was nearly double the offer it declined from MGM this year.

Online betting group Flutter Entertainment rose 4.6% after it agreed to pay $200 million to the Commonwealth of Kentucky to settle a judgement reinstated last year.

The Europe-wide STOXX 600 index gained 0.5%, extending Tuesday’s bounce after its worst session in two months, with commodity-linked stocks also in the lead.

In the meantime, in the United States, the Federal Reserve should close its two-day policy meeting later in the day, with investors waiting for it to clear the way for a reduction to its monthly asset purchases later this year and revise its inflation and growth estimates.

After seven straight months of gains, sentiment turned negative across global equities in September on concerns about China’s slowing growth, the fast-spreading Delta variant of COVID-19 and tougher monetary policies.

The STOXX 600 lost more than 2% so far this month and is positioned for its worst monthly performance in about a year.

Deutsche Post dropped 1.3% after U.S. delivery firm FedEx Corp reduced its full-year forecast after labour shortages curbed earnings and slowed packages. German truck maker Traton dropped by 0.6% after it said that sales in September were particularly hurt by a global shortage of chips and other car parts.