UPDATE 2-European shares rise on trade talks optimism; Michelin inflates autos

Reuters

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    * Plus500 sinks after profit warning
    * Michelin shares register best day in nearly a decade 
    * Gucci owner Kering falls
    * Credit Suisse takes profits on global equities

 (Adds closing prices)
    By Josephine Mason
    LONDON, Feb 12 (Reuters) - European shares closed higher on
Tuesday as investors cheered positivity around U.S.-China trade
talks and signs of a compromise to avoid another U.S. government
shutdown, while Michelin's results pumped up automotive stocks.
    The pan-European STOXX 600  .STOXX  was up 0.5 percent, with
Germany's trade-sensitive DAX  GDAXI  advancing 1 percent and
Paris' CAC 40  .FCHI  up 0.8 percent.
    Automakers and their suppliers  .SXAP  were the biggest
gainers, up 2.9 percent after Michelin  MICP.PA  delivered
better than expected results and pledged further gains in
operating profit this year despite challenging conditions.
    The French tyre maker's shares rallied 13 percent for their
best day in nearly a decade. 
    Italy's Pirelli  PIRC.MI  and Germany's Continental
 CONG.DE  were among the biggest gainers in their domestic
markets and on the STOXX 600.
    London indices  .FTSE  .FTMC  underperformed their euro zone
peers as the pound rose slightly after a parliamentary address
by British Prime Minister Theresa May, in which she asked for
more time to secure a Brexit deal.    
    Gucci owner Kering  PRTP.PA  was another winner, with its
shares turning positive in mid-morning trade as investors took
comfort from upbeat comments on the first-quarter outlook.
 urn:newsml:reuters.com:*:nP6N1X304B
    Its shares had fallen as much as 3.3 percent in early trade
as better than expected sales initially failed to impress
investors in a sign of the demanding expectations for luxury
brands after solid numbers from the sector, including LVMH
 LVMH.PA  last week. The shares closed with a 3.3 percent gain.
    Thyssenkrupp  TKAG.DE  fell 2 percent after a mixed earnings
report. The German steel-to-elevator company stood by its
2018/19 targets but reported a big drop in first-quarter results
and warned that the global economic environment is darkening.
    Investors continued to punish TUI  TUIGn.DE  as the tour
operator reported a widening loss in the three months to Dec.
31. Shares fell another 5.4 percent after its profit warning
last week. 
    Online trading platform Plus500  PLUSP.L  lost about 30
percent of its value after the company issued a profit and
revenue warning, blaming tightening EU regulation on its retail
business. The news dragged peer IG  IGG.L  with it. urn:newsml:reuters.com:*:nL3N2072F2 
    Credit Suisse said it was shifting to a "neutral" stance on
global equities, taking profit on its "overweight" view.
    "While we continue to expect overall attractive total
returns from global equities this year, we recognise certain
mounting short-term risks," it said.
    "In particular, we note that investors remain thin-skinned
after last December's correction."
    Furthermore, the U.S.-China trade conflict could lead to
renewed volatility while growing political tensions in Italy,
France and Germany and the still uncertain Brexit outcome could
weigh further on European stocks, the bank said.

 (Reporting by Josephine Mason and Julien Ponthus
Editing by Keith Weir and David Goodman)
 ((mailto:Josephine.Mason@thomsonreuters.com; +44 207 542 7695;
Reuters Messaging:
rm://josephine.mason.reuters.com@reuters.net))

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