January 13, 2017 / 9:47 AM / 9 months ago

Autos power European stocks, Britain's FTSE sets new high

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* Britain’s FTSE sets new record high

* STOXX Europe 600 index also up

* Fiat partly recovers after slump

* UBI Banca among top risers

By Atul Prakash

LONDON, Jan 13 (Reuters) - European shares rose on Monday, led higher by automobile stocks, with Britain’s benchmark equity index setting a new all-time high and on track for a record 14th straight session of gains.

However, shares of French media company Technicolor fell 18 percent and were on track for their worst-ever one-day loss after a profit warning.

The European automobile index rose 1.8 percent, boosted by Fiat Chrysler Automobiles, which gained more than 5 percent, recouping some of their previous session’s 16 percent slump.

That was triggered by the U.S. Environmental Protection Agency’s (EPA) accusations that the car maker illegally masked excess diesel emissions. However Chief Executive Officer Sergio Marchionne told La Repubblica newspaper on Friday that the EPA’s accusations that Fiat violated emissions laws will not have any impact on the carmaker’s business plan targets.

Italian stocks dominated the list of top performers on the STOXX. Investment company Exor, which has a stake in Fiat, rose more than 6 percent.

UBI Banca surged 8.8 percent after HSBC raised its target price for the stock following the company’s forecasts on Thursday to generate a net profit of 1.2 billion euros by 2020, up from 900 million euros under current business plan.

The European banking index also featured among top sectoral gainers, with investors expecting encouraging results from some major U.S. financial companies.

“With the (U.S. Federal Reserve) having raised rates last month and is expected to undertake additional hikes in 2017, banks are gaining on popularity again between investors, especially as many funds are still underweight this sector,” Markus Huber, trader at City of London Markets, said.

Britain’s blue-chip FTSE 100 index set another record high of 7,329.29 points and was last quoted 0.4 percent higher. It was also on track for its sixth straight weekly gain. It is up 1.5 percent so far this week, the biggest weekly gain since early December.

The pan-European STOXX 600 was up 0.5 percent, while Germany’s DAX and France’s CAC rose 0.4 percent and 0.5 percent respectively.

Precious metals miners, however, came under pressure as gold prices retreated from the previous session’s seven-week peak on a stronger dollar. Shares in Fresnillo and Randgold Resources fell 1.7 percent and 0.4 percent respectively. (Editing by Jeremy Gaunt)

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