UPDATE 2-European stocks hold eight-month highs despite lockdown fears

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* Banking, energy, auto parts stocks build on Monday rally
* UK redundancies hit record high as job market slumps
* German investor morale drops on second lockdown
* Unibail tops STOXX 600 as shareholders reject rights issue

(Adds comments, updates prices)
By Sagarika Jaisinghani and Shreyashi Sanyal
Nov 10 (Reuters) - European shares held near eight-month
highs on Tuesday, riding a wave of optimism about a COVID-19
vaccine breakthrough, although concerns about the pandemic's
economic damage capped gains.
The pan-European STOXX 600 .STOXX , which rallied 4% on
Monday after positive news from U.S. drugmaker Pfizer PFE.N
about its COVID-19 vaccine candidate, rose 0.9%.
The European Commission said it will approve on Wednesday a
contract for the supply of Pfizer and its partner BioNTech's
22UAy.DE potential coronavirus vaccine.
"European equity markets are consolidating following
yesterday's impressive rally," Milan Cutkovic, market analyst at
Axi, said of European shares, which have surged 12% this month.
While President-elect Joe Biden is expected to restore a
calmer U.S. trade and foreign policy, strict coronavirus
lockdowns have threatened a nascent European recovery.
"A large part of Europe is still in a partial or full
lockdown, and it is crucial to avoid a back and forth between
different levels of restrictions as this is causing significant
damage to consumer and business confidence," Cutkovic said.
The ZEW economic research institute said German investor
sentiment fell more than expected in November on concerns over a
second lockdown. London's FTSE 100 .FTSE rose 1.8%, despite data showing
that British employers made a record number of staff redundant
in the third quarter and the jobless rate jumped. Italy's bourse .FTMIB added 0.4% a day after posting its
best day since March. The country is ramping up business
restrictions in Tuscany and four other regions to rein in the
second wave of the pandemic. Banking .SX7P , auto parts .SXAP and energy .SXEP
stocks were among Europe's biggest gainers, while travel &
leisure stocks .SXTP fell on lockdown concerns.
"Even if a vaccine proves effective, inoculating a large
enough part of the population will take time and leave these
segments prone to economic lockdown fallout," Commerzbank
analyst Christoph Rieger said.
In Amsterdam, shopping mall owner Unibail-Rodamco-Westfield
URW.AS shares surged 21% to the top of the STOXX 600 after its
shareholders voted against a planned 3.5 billion euro ($4.15
billion) rights issue.