European stock markets supported by the strengthening of financial stocks



* FTSEurofirst 300 up 1.5%, FTSE 100 up 1% at close

* FTSE underperforms due to weakness in mining stocks

* Low volumes due to the holiday season

* Italian Prysmian rides on Bahrain contract win (adds details, updates with closing prices)

By Sudip Kar-Gupta and Kit Rees

LONDON, December 29 (Reuters) – European stock markets rose on Tuesday, helped by gains in the banking sector, although weak mining stock prices held back the UK market.

The pan-European FTSEurofirst 300 index was up 1.5% at its close while the euro zone blue-chip Euro STOXX 50 index rose 1.8%.

The UK blue-chip FTSE 100 index was up 1% at its close, underperforming larger gains of 1.9% on the German DAX and 1.8% on the French CAC.

The relative underperformance of the London market is due to a drop in mining stocks, which represent around 5% of the overall market capitalization of the FTSE.

The mining sector lost ground on Tuesday as the price of copper hit its lowest level in more than a week and aluminum fell amid concerns over demand from China, which is the biggest consumer of metals in the world.

“The UK index is struggling to match its peers in the eurozone, hampered by the mining sector,” said Connor Campbell, analyst at Spreadex.

With many traders away for the Christmas season, trading volumes were just over half of FTSEurofirst’s daily three-month average.

Deutsche Bank rose 2.5% following its decision to sell its 20% stake in Chinese bank Hua Xia to insurer PICC Property and Casualty Co for up to 25.7 billion yuan (4 billion yuan). dollars).

The rise in Deutsche Bank’s share price pushed the STOXX Europe 600 banking index up 1%.

Italian cable systems company Prysmian also outperformed, up 3% after the announcement of a new contract in Bahrain.

Naeem Aslam, chief market analyst at brokerage AvaTrade, said European stocks appeared to be in a good position for 2016, given the European Central Bank’s measures to support the eurozone economy.

“European markets remain the place to invest, with the ECB pumping more money into the system,” Aslam said.

The FTSE is down around 4% since the start of 2015, underperforming a 6% gain on the pan-European FTSEurofirst 300 index. (Edited by Ruth Pitchford)



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