UPDATE 2-European shares rise, spurred on by healthcare stocks

  • Reuters
  • Stock Market News
UPDATE 2-European shares rise, spurred on by healthcare stocks
Credit: © Reuters.

* Healthcare stocks aid STOXX 600; Lonza announces carve out

* Infineon clocks over 2-1/2 year closing low on Cypress deal

* Banks, tech, financial services slip (Updates to close, recasts, adds graphic, quote)

By Aaron Saldanha

June 3 (Reuters) - European shares recovered from early losses to end Monday higher as gains in healthcare stocks helped head off weakness in trade-sensitive sectors like technology after the latest twist in the U.S.-China trade war.

China will reportedly investigate whether FedEx Corp (NYSE: FDX ) FDX.N damaged its clients' legal rights and interests after telecoms giant Huawei said parcels intended for it were diverted. between the U.S. and China, and the U.S. and Mexico, are still high - the highest they have been recently, so today's move might turn out to be a relief rally," David Madden, market analyst at CMC (NS: CMC ) Markets UK, wrote in a note.

"It has been an impressive turnaround seeing as the major indices were offside this morning, and traders seem to have shrugged off the negative sentiment."

The pan-European STOXX 600 .STOXX gained 0.4%, coming off a 3-1/2-month low hit earlier in the day.

Germany's DAX .GDAXI rose 0.6%, shaking off pressure from a 8.1% slide in Infineon's shares IFXGn.DE after the chipmaker agreed to buy Cypress Semiconductor CY.O for $10 billion. firm Wirecard WDIG.DE rose 3.6% following a tweet by Chief Executive Markus Braun on Sunday saying the company was "steering towards an outstanding first half year of 2019". KGaA MRCG.DE was a source of optimism to both Germany's DAX and the STOXX 600, rising 2.1%. It reported Phase II results for an investigational therapy. Group LONN.S gained 3.9% on announcing it will carve out its specialty ingredients business and cut around 130 jobs there as it reorganises the struggling division. stocks .SXDP , up 1.4% on the day, dipped during May but greatly outperformed the STOXX 600 over the course of a month which saw investors scurrying toward safe havens as no end to the U.S.-China trade war appeared in sight.

The tech sector .SX8P - relatively exposed to worsening global trade ties - slipped 0.3% on Monday, with Infineon's chipmaking peer ASM International ASMI.AS declining 0.7%.

"We can see the industrial logic...but there are bigger issues at play which could kibosh the deal. The last time Infineon attempted to acquire U.S. assets the deal was terminated, citing security concerns raised by the U.S. government back in 2017," Neil Campling, Mirabaud's head of TMT Research, wrote in a note on the Infineon deal.

Financial services stocks .SXFP fell 0.7%, with Bolsas y Mercados Espanoles SHMSF SA BME.MC leading the losses with a slide of 3.8%.

The Spanish exchange operator reported a 22.3% year-on-year drop in trading volumes for the month of May. and leisure stocks .SXTP fell 0.6%, weighed on by a 4.4% decline in TUI TUIT.L as the travel firm's contingency measures to cope with the grounding of Boeing (NYSE: BA ) 737 MAX jets were triggered. .SX7P dipped 0.5%, with Natixis CNAT.PA sliding 4%. Credit Suisse (SIX: CSGN ) cut its target price on the French lender's stock to 4.90 euros per share from 5.70 euros per share. Performance of STOXX 600 and the healthcare sub-index during May



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