Europe midday: Shares extend gains on China recovery hopes

European shares extended gains at midday in what was expected to be muted trade, following on from Tuesday’s luxury-stock driven rally.

The benchmark Stoxx 600 index was up 0.47% at 1210 GMT despite a mixed session in Asia. Trade on the London Stock Exchange resumed after the long holiday break and made a strong start, up 1%.

"The UK index could end the year in positive territory despite the broad pressures on global equity markets, weighed down by rising interest rates, inflation, and the threat of recession," said Victoria Scholar, head of investment at Interactive Investor.

Miners were higher on the back of a rally in copper prices driven by hopes of a recovery in China, which on Monday further eased its tough Covid restrictions. Antofagasta shares were up on the news.

Financial firms with a China focus, such as insurer Prudential and HSBC, were also higher.

Asia trade was choppy, as investors continued to fret about Covid cases in China and the impact on the global economy. China's announcement that it planned to ease pandemic border restrictions had boosted European luxury retailers on Tuesday.

In equity news, Wizz Air and easyJet flew lower after Italy’s competition regulator has launched an inquiry into potential price-fixing of flights to and from Sicily.

Consumer group Codacons filed a complaint about prices on the route. Ryanair, Wizz Air and easyJet are among the airlines potentially involved as well as state-owned ITA Airways.

Reporting by Frank Prenesti for Sharecast.com