European rout pauses as stimulus calms recession panic

(Reuters) – European shares edged higher from near-seven year lows on Thursday as another set of dramatic stimulus measures by the bloc’s central bank injected a ray of hope around its preparedness to tackle a major health crisis gripping the continent.

After volatile trading in Euro Stoxx 50 futures earlier in the day, the pan-European STOXX 600 index <.STOXX> was up 0.5% at 0815 GMT, with almost all the major country indexes trading higher.

The European Central Bank joined peers in Japan, Australia and the United States in launching a fresh wave of emergency stimulus to help businesses battered by a near halt in economic activity from the coronavirus pandemic.

Although banking <.SX7P> and oil and gas <.SXEP> stocks rose in early trading, travel and leisure firms <.SXTP> fell another 3% on growing concerns of a complete collapse of the sector.

Germany’s Lufthansa said on Thursday the airline industry may not survive without state aid if the virus outbreak lasted for a long time.

(Reporting by Sagarika Jaisinghani in Bengaluru; Editing by Bernard Orr)