European shares extend rally as Italy hopes offset Brexit clouds

  • Reuters
  • Stock Market News
European shares extend rally as Italy hopes offset Brexit clouds
Credit: © Reuters.

MILAN, Dec 13 (Reuters) - European shares rose for a third day running on Thursday as hopes over a compromise over Italy's contested budget and easing concerns over trade offset persistent uncertainty over Britain's exit from the European Union.

The euro zone STOXX index .STOXXE rose 0.4 percent while the FTSE 100 .FTSE lagged slightly behind, up 0.2 percent, after PM Theresa May saw off a leadership challenge but a mutiny by more than a third of her lawmakers indicated parliament was heading towards deadlock over Brexit.

The pan-European STOXX 600 benchmark .STOXX was up 0.2 percent.

Italian stocks outperformed with the country's banks index .FTIT8300 up 3.2 percent after the government cut its deficit goal for 2019 with EU Commissioner Pierre Moscovici saying the bloc was having constructive talks with Rome.

Shares in Intesa Sanpaolo ISP.MI , Italy's largest retail bank, were among the leading gainers in Europe, up 3.7 percent, while German lenders Deutsche Bank DBKGn.DE and Commerzbank CBKG.DE extended their rally on M&A chatter.

Plastic Omnium PLOF.PA advanced 10.1 percent after an upbeat update from the French plastic processing group, while G4S (CO: G4S ) GFS.L soared 8.7 percent after the British security company said it was looking at a separation of its cash solutions business. faller in Europe was Metro B4B.DE , down 8.3 percent after the German wholesaler predicted a fall in profits due to its struggling Russia business.

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