European shares near '12 peak on U.S. fiscal hopes

LONDON Wed Dec 19, 2012 3:10am EST

LONDON Dec 19 (Reuters) - European shares continued to drift higher on Wednesday as expectations built that a budget deal in the United States is close, though traders reckoned any positive outcome is largely baked into the price.

The FTSEurofirst 300 was 0.2 percent firmer at 1,139.85 by 0808 GMT, within a whisker of testing 18-month highs hit last week, having added 0.4 percent on Tuesday.

"The market remains firm on continued budget hopes but the bottom line is that 2012 is pretty much done and most people are about to close their books for the year," said Lex van Dam, hedge fund manager at Hampstead Capital, which manages around $500 million of assets.

The euro hit multi-month highs and Japan's Nikkei average rose above the 10,000 mark for the first time in more than eight months on Wednesday on signs of progress towards averting a "fiscal cliff" of growth-curbing austerity measures and expectations of more aggressive monetary stimulus from the Bank of Japan.

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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