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* STOXX 600 hits seven-week lows
* Travel & leisure lose 20% in Nov
* Fed's Powell says U.S. inflation may not be transitory (Updates to close)
By Anisha Sircar and Susan Mathew
Nov 30 (Reuters) - European stocks fell on Tuesday after U.S. Federal Reserve chair Jerome Powell warned U.S. inflation may not be transitory and as worries about the efficacy of existing vaccines against the Omicron COVID-19 variant weighed on investors.
The pan-European STOXX 600 closed down 0.9%, after having fallen up to 1.6% during the session to seven week lows.
During his testimony to the Senate Banking Committee, Powell said the Fed would use its tools to cool prices, and might consider tapering bond purchases sooner than decided.
The Fed will wait for more details on Omicron before deciding on monetary policy, Powell said, raising further anticipation about the December meeting.
"Another bout of commentary from Jerome Powell over the economic and inflation risks posed by this latest COVID strain highlight how the bank still remains in position to tighten policy further if necessary," said Joshua Mahony, senior market analyst at IG.
The travel and leisure sector led losses in Europe, down 2.8%, taking monthly losses to 20.6% - the worst month since March 2020.
British airline easyJet slid 1.2% after reporting softer demand following the emergence of the Omicron variant.
Pandemic-sensitive sectors slumped last week when the variant was first detected in South Africa, wiping out roughly $2 trillion off the value of global stocks on Friday.
Capping losses on Tuesday were material stocks, rising about 0.1%.
Powell's comments also put the European Central Bank's stance back in focus, especially with German inflation hitting highest in decades. Commentary from ECB members this month showed they are still holding to the transitory inflation narrative.
The STOXX 600 lost 2.6% in November, after rising 4.6% last month.
Among stocks, video games maker CD Projekt plunged 4.6% after its profit fell significantly short of expectations in the third quarter.
Spanish fashion retailer Inditex fell 6.1% after saying that Marta Ortega, daughter of its founder, will replace Pablo Isla, who successfully led the company for a decade.
Money transfer company Wise Plc jumped 7.7%, after it lifted its full-year revenue growth forecast on Tuesday after seeing it jump by a third in the first half. (Reporting by Sruthi Shankar and Anisha Sircar in Bengaluru; Editing by Uttaresh.V, Arun Koyyur and Alison Williams)