London: European stock markets rose solidly Tuesday, led by Milan's main index and Italian banking shares, after ailing UniCredit said it would axe thousands of jobs and raise billions of euros.
Leading Asian stock markets ended higher, with Tokyo closing at a one-year high.
Attention was turning to the much-anticipated Federal Reserve rate meeting, while analysts said a Trump-fuelled rally that saw the Dow reach another record close Tuesday may have been overblown.
Oil prices advanced as the International Energy Agency watchdog hiked its forecast for global crude demand growth.
Around 1115 GMT, Frankfurt's main stocks index was up 0.8 percent compared with Monday's close. Paris won 0.7 percent, Madrid jumped 1.0 percent and Milan rallied 1.7 percent.
Outside the eurozone, London gained 0.2 percent as traders assessed a bigger-than-expected jump to British inflation, partly the result of a weaker pound following the Brexit referendum.
Separate data showed that despite uncertainty over Italy's troubled banks and upcoming elections in Europe, investor confidence in Europe's economic powerhouse Germany held steady this month.
- 'Recapitalising Italy's banks -
Mike van Dulken, head of research at Accendo Markets, said stock market sentiment was buoyed Tuesday "by suggestions of progress in recapitalising Italy's troubled banks as well as expectations that the Fed will... still signal a cautious path for further rate hikes" following an expected raise Wednesday.
Italy's biggest bank, UniCredit, meanwhile announced plans Tuesday to slash 14,000 jobs as the country gets to grips with political instability and a banking crisis.
The bank, one of the worst performers in European bank stress tests, confirmed it would also need 13 billion euros ($13.8 billion) in fresh capital from investors despite political complications in Italy and the nation's third-largest bank scrambling to avoid a government-led rescue.
At the weekend Italy's troubled Monte dei Paschi di Siena (BMPS) said it would go ahead with plans to seek a private sector-led rescue.
In Tuesday midday trading, shares in UniCredit were up more than eight percent and BMPS climbed 1.6 percent.
There is meanwhile little room for doubt that the US Federal Reserve will raise its benchmark interest rate on Wednesday for only the second time in a decade.
It comes against the backdrop of US unemployment at a nine-year low, jobs being created at an average of 180,000 per month, the world's biggest economy growing at better than three percent in the most recent quarter and some signs of a pickup in inflation.
- Key figures around 1115 GMT -
London - FTSE 100: UP 0.2 percent at 6,907.11 points
Frankfurt - DAX 30: UP 0.8 percent at 11,281.45
Paris - CAC 40: UP 0.7 percent at 4,795.70
Milan - FTSE Mib: UP 1.7 percent at 18,686.90
EURO STOXX 50: UP 1.0 percent at 3,230.09
Tokyo - Nikkei 225: UP 0.5 percent at 19,250.52 (close)
Hong Kong - Hang Seng: UP 0.1 percent at 22,446.70 (close)
Shanghai - Composite: UP 0.1 percent at 3,155.04 (close)
New York - Dow: UP 0.2 percent at 19,796.43 (close)
Euro/dollar: DOWN at $1.0622 from $1.0636 Monday
Dollar/yen: UP at 115.26 yen from 115.04 yen
Pound/dollar: UP at $1.2719 from $1.2678
Oil - West Texas Intermediate: UP 30 cents at $53.13 per barrel
Oil - Brent North Sea: UP 37 cents at $56.06
