Paris at year's high as European, US stocks extend gains

European markets rose Tuesday as Paris stocks reached the year's highest level and Italian banks surged, while US stocks finished at yet another record. Markets have held their ground despite Italian Prime Minister Matteo Renzi's resignation following his defeat in Sunday's referendum, which came in the wake of recent shock votes in Britain and the United States. The year has seen a wave of anti-establishment populism, which included Britain's vote to leave the EU and the US election of Donald Trump for president. "If neither Brexit nor a vision of Donald Trump in the White House could convince traders to dump shares, it's hardly surprising a 'no' vote in the Italian referendum failed to dent investor confidence," said Lee Wild, head of equity strategy at stockbroker Interactive Investor. The euro held above $1.07, having crashed Monday to a 20-month low at $1.0506. In the US, the Dow finished at its second straight record, edging up 0.2 percent to 19,251.78, led by a rally in financial shares. Shrugging off the uncertainty over Italy's political future, France's CAC 40 closed the day at a record high for the year. "Investors believe that the referendum is not threatening eurozone fundamentals," said Daniel Larrouturou at Diamant Bleu Gestion. Francoise Rochette, head of asset management at Mandarine Gestion, said, "The feeling is that there won't be early elections in Italy, so that political problem is now out of the way." Frankfurt's DAX also closed higher, partly influenced by a ruling from Germany's Constitutional Court that energy companies have a right to compensation after the government ordered the shutdown of the country's nuclear power plants in the wake of the 2011 Fukushima disaster in Japan. And Milan's benchmark FTSE MIB shares soared, continuing the previous day's run. The index closed more than four percent higher, as banking stocks surged, led by a 12.8-percent gain for UniCredit. London stocks also ended higher after a brief stumble earlier over jitters surrounding an ongoing legal challenge to Britain's June 23 referendum decision. - Political risks - "Considering the FTSE MIB has bucked the overall up trend in stock markets and has fallen 22 percent so far this year, you could argue that an adverse outcome from the referendum was already priced in," said City Index analyst Kathleen Brooks. "Markets would be wise not to get too complacent about political risks." Attention now is shifting to the US Federal Reserve's expected interest rate increase next week, with traders hoping it will give some indication of its plans for 2017 as US President-elect Trump plans to embark on a big-spending program that likely will fan inflation. Shares of Boeing finished up 0.1 percent shrugging off early weakness after Trump called for the cancelation of the aerospace giant's multi-billion dollar contract to build the next Air Force One due to ballooning costs. Boeing said it would work with the US Air Force to "deliver the best planes for the president at the best value for the American taxpayer." - Key figures around 2200 GMT - New York - Dow: UP 0.2 percent at 19,251.78 (close) New York - S&P 500: UP 0.3 percent to 2,212.23 (close) New York - Nasdaq: UP 0.5 percent at 5,333.00 (close) London - FTSE 100: UP 0.5 percent at 6,779.84 points (close) Frankfurt - DAX 30: UP 0.9 percent at 10,775.32 points (close) Paris - CAC 40: UP 1.3 percent at 4,631.94 (close) Milan - FTSE MIB: UP 4.2 percent at 17,757.80 points (close) EURO STOXX 50: UP 1.6 percent at 3,102.70 Tokyo - Nikkei 225: UP 0.5 percent at 18,360.54 (close) Hong Kong - Hang Seng: UP 0.8 percent at 22,675.15 (close) Shanghai - Composite: DOWN 0.2 percent at 3,199.65 (close) Euro/dollar: DOWN at $1.0719 from $1.0764 Monday Dollar/yen: UP at 114.03 yen from 113.85 yen Pound/dollar: DOWN at $1.2678 from $1.2729 Oil - Brent North Sea: DOWN $1.01 at $53.93 per barrel Oil - West Texas Intermediate: DOWN $0.86 at $50.93 per barrel