UPDATE 2-Travel firms propel European stocks to strongest close in 11 weeks

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* Travel stocks shine on plans to open up tourism

* Banks, insurers, automakers among top gainers

* Measures to help French autos sector worth 8 bln euros (Updates to market close)

By Sruthi Shankar

May 26 (Reuters) - European shares closed at an 11-week high on Tuesday, with travel and leisure stocks soaring on hopes of a revival in tourism as countries gradually reopened after a months-long lockdown.

The pan-European STOXX 600 .STOXX rose 1.1% to hit its highest closing level since March 9.

Europe's battered travel sector .SXTP jumped 6.9% following reports Spain and Germany would ease travel restrictions, while no noticeable increase in infections were reported after the easing of lockdowns. Airways owner IAG ICAG.L jumped 22.5%, low-cost carrier easyJet Plc EZJ.L gained 19% and UK-listed shares of travel group TUI TUIT.L soared 52%.

Germany's Lufthansa LHAG.DE extended gains after the government threw the airline a 9 billion euro ($9.87 billion)lifeline on Monday. FTSE 100 .FTSE returned from a holiday to rise 1.2% as Prime Minister Boris Johnson said Britain will reopen thousands of high street shops, department stores and shopping centres next month. .L

Other hard-hit sectors such as eurozone banks .SX7E surged 6.5%, bouncing off record low levels, while insurers .SXIP and automakers .SXAP gained about 3% each.

"We believe that the pro-cyclical market bias that we called for will have some legs, and build on itself in the next weeks," J.P. Morgan Cazenove analysts told clients.

"It should last while PMIs are normalizing. The upmove in Eurozone PMI that we saw last week is likely to extend in the next reading, for June."

The STOXX 600 has climbed 30% from its mid-March lows, as hopes of further policy support and improving economic data fuelled hopes of a faster economic recovery from the novel coronavirus pandemic.

All eyes will be on the European Commission's release of its recovery plan on Wednesday to gauge the progress of a Franco-German proposal for a 500 billion euro grants-based coronavirus recovery fund.

Paris-headquartered shopping centre operator Klepierre SA LOIM.PA jumped 12.6% after saying it had reopened 80% of its European malls and hopes to reopen 90% of them within 10 days. carmakers Renault SA RENA.PA and Peugeot SA PEUP.PA jumped 6.6% and 5.8% respectively.

French President Emmanuel Macron said that measures announced to help the country's car industry were worth more than 8 billion euros ($8.8 billion) in total. said autonomous and electric vehicles will form a key part of the sector after the coronavirus crisis. SASY.PA fell 1.3%, in line with broader healthcare losses, despite the French drugmaker's impending $13 billion payday from selling most of its 20.6% stake in U.S. partner Regeneron REGN.O . = 0.9116 euros)