* FTSEurofirst 300 gains 0.2 pct, up 5 pct in 2 weeks
* Italian shares steady as Renzi set to meet Napolitano
* Europe equity funds see $17 bln in inflows year-to-date
By Blaise Robinson
PARIS, Feb 17 European stocks inched higher in
early trade on Monday, extending a two-week rally and tracking
gains in Asia as worries over emerging markets eased.
Shares in cyclical mining shares - which have a strong
exposure to emerging markets such as China - featured among the
top gainers, with BHP Billiton and Glencore Xstrata
up 1.2-1.3 percent.
At 0906 GMT, the FTSEurofirst 300 index of top
European shares was up 0.2 percent at 1,334.44 points. The
benchmark index, which has surged 5 percent over the past two
weeks, is less then 2 percent below a 5-1/2 year high hit in
Trading volumes were expected to be thin as Wall Street will
be closed for a public holiday.
Italian shares were steady, with Milan's FTSE MIB
up 0.03 percent. The index strongly outperformed on Friday, with
a 1.6 percent rally, as investors welcomed the likelihood of
centre-left leader Matteo Renzi becoming prime minister.
Renzi is set to meet on Monday Italian President Giorgio
Napolitano, who is expected to ask him to form a new government.
"Investors are quite sanguine about the economic and
political situation in peripheral Europe, and that's a very
positive signal. Ten-year bond yields continue to fall across
the board, a sign of stability which has prompted a lot of
investors to come back," said David Thebault, head of
quantitative sales trading, at Global Equities.
The MIB is up nearly 8 percent so far this year, strongly
outperforming a 1.6 percent rise in the FTSEurofirst 300, as
global investors pour money into peripheral euro zone equities,
betting on the region's economic recovery.
According to data from EPFR Global, European equity funds
have enjoyed net inflows of $17 billion since the start of the
year, marking a record start to the year and a sharp contrast
with massive outflows hitting emerging market funds.
Within Europe, Italy and Spain equity funds have been
leading the way in terms of inflows, EPFR said.
Bucking the trend on Monday, ThyssenKrupp fell 2
percent, with traders pointing to Citigroup cutting its
recommendation on the stock to "sell" from "neutral", citing
"The market is continuing its recovery," said Berkeley
Futures associate director Richard Griffiths.
France's Bouygues slipped 0.8 percent after
unveiling a 1.4 billion euro ($1.9 billion) writedown on its
investment in Alstom to reflect the train and turbine
maker's weaker cash flow forecasts.
In core European markets, the UK's FTSE 100 index
was up 0.4 percent, Germany's DAX index down 0.1
percent, and France's CAC 40 down 0.1 percent.
Europe bourses in 2014:
Asset performance in 2014:
Today's European research round-up