DAX: 3707.99 (+30.56)

German shares took their cue from Wall Street and the dollar early yesterday and posted solid gains over bourse trading, but dealers said on-going uncertainty about European Monetary Union capped the market's advance.

"We are delighted to see the market getting back in step with Wall Street," said one Frankfurt dealer.

CAC-40: 2760.427 (+64.08)

French shares closed sharply higher, lifted by market friendly US economic data and optimism that a European Union budget deficit control pact would be approved at the EU summit in Amsterdam next week.

Mibtel: 12469 (+256)

Italian shares closed sharply higher yesterday on a surge of buying prompted by hopes that France and its EU partners can agree on a stability pact, a strong showing on Wall Street and underlying buoyancy in the bond market.

A call by Bank of Italy Governor Mr Antonio Fazio for government spending cuts, failed to unsettle the market.