European shares rally sharply ahead of producer price data

(Reuters) - European shares climbed for the third-straight session on Tuesday, as investors scooped up beaten-down shares of technology, travel and leisure companies, while also looking ahead to a reading on inflation data due later in the day.

The region-wide STOXX 600 index was up 1.8% by 0722 GMT, hitting its highest level since Sept. 23 along the way, and tracking a solid rally on Wall Street overnight. [.N]

London's blue-chip FTSE 100 index rose 1.4%, building on gains from the previous session after the UK conservative government's decision to reverse parts of its controversial tax cut plans.

All of the STOXX 600's sectoral indexes gained, led by a 2.8% jump in travel and leisure stocks. Rate-sensitive tech stocks added 2.4% as bond yield slipped.

Sika gained 4.2% after the Swiss chemicals maker raised its full-year sales forecast and launched a sale process for a part of a former BASF business it had acquired last year.

Data due at 0900 GMT is expected to show euro zone producer prices accelerated further in August, with a likely annual jump to 43.1% from 39.5% in July.

Last week, data showed consumer prices zoomed past forecasts to hit a record 10% in September, reinforcing expectations for another jumbo interest rate hike later this month.

(Reporting by Devik Jain in Bengaluru; Editing by Savio D'Souza)