Europe close: Stocks continue to push higher, Italian issues jump

Stocks on the Continent added to recent gains helped by another leg higher in euro area government bonds, especially for Italian ones, and as Wall Street continued to push higher.

Stoking buying interest in government debt, the European Commission shied from taking disciplinary action against Italy after Rome assured Brussels that it would stick to fiscal discipline both in 2019 and 2020.

In the background, 'market chatter' was that EU leaders' decision to settle on International Monetary Fund managing director, Christine Lagarde, as the next head of the European Central Bank, would likely ensure continued monetary accommodation - although there were analysts who were expressing some reservations.

"The bullish mood in Europe continues, and the picture appears to have become clearer in regards to European politics. Christine Lagard of the IMF, has been nominated as head of the European Central Bank, and equity traders reacted well as she is deemed to be dovish in terms of monetary policy.

"It seems odd that a non-central banker is being put forward as head of one of the largest central banks in the world at a time when the eurozone still has major problems in terms of debt and unemployment."

By the end of trading, the benchmark Stoxx 600 had added 0.85% to 392.58, alongside a rise of 0.75% to 5,618.81 for the Cac-40 and a gain of 2.40% to 21,905.34 for the FTSE-Mibtel.

In parallel, the yield on the benchmark 10-year Italian Treasury note was down by 26 basis points to 1.58% and that on similarly-dated Spanish debt by eight points at 0.21%.

Front month Brent crude oil futures were higher in tandem, recouping part of the previous session's losses and rising 1.964% to $63.65 per barrel on the ICE.

To take note of, US markets were due to only be open for a shortened trading session in observance of the 4 July holiday the next day.

The economic calendar in Europe was light on Wednesday, with investors mainly waiting on revised readings for IHS Markit's services sector and composite Purchasing Managers' Index for the month of June, at 0900 BST.

However, a slew of other economic indicators were scheduled for release in the afternoon Stateside, including data on foreign trade, weekly jobless clams and the ISM institute's factory sector Purchasing Managers' Index.

German consumer goods outfit Henkel was on the front foot on the back of an upgrade out of Goldman Sachs from 'neutral' to 'buy'.

Shares of chipmakers such as Infineon on the other hand came under pressure after the US Department of Commerce overnight reportedly told staff that Chinese telecommunications equipment maker Huawei should still be treated as if it were blacklisted.