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European shares close to a 2-year high

Monday, January 21 12:29:01

European shares edged up today, moving back towards their recent near-two-year high, helped by moves to break a budget impasse in the United States and by gains in the utilities sector.

Traders said the longer-term outlook remained bullish for European stock markets, with some key indexes falling back from technically "overbought" levels.

The pan-European FTSEurofirst 300 index rose by 0.1 percent to 1,164.98 points at around midday, heading back to the 1,170.29 points level reached earlier this month - its highest since early March 2011.

The euro zone's blue-chip Euro STOXX 50 index advanced by 0.3 percent to 2,717.83 points.

Traders cited as a factor expectations a political deal will be reached in the United States to raise the country's debt ceiling, after the Republican party said it would seek to pass a three-month extension of federal borrowing authority next week.

"A positive impulse out of the U.S. - as the debt ceiling impasse seems to have been overcome - may revive the appetite for shares, but the impact today will be limited," said Gekko Global Markets senior sales trader Anita Paluch.

U.S. markets are closed on Monday for a public holiday. (C ) Reuters