Renewed hopes of a German interest rate cut helped power Frankfurt shares to a fresh record and underpinned other major bourses in Europe. Rate hopes, fuelled by comments from Bundesbank council member Mr Hans Juergen Koebnick, boosted German government bonds and equities followed suit. International investors have also switched their attention to Frankfurt, undeterred by last week's economic data that underlined Germany's economic slowdown.

Paris CAC 40 1924.40 (+16.81)

French shares finished higher, in line with other European markets, with the market bolstered by gains on the bond market and hopes of a rate cut this week.

Volume, however, remained light as dealers remained on the sidelines.

Milan Mibtel 9177 (-159)

Milan shares ended easier in very quiet trading as political uncertainty weighed on the market at the end of the monthly account period, dealers said.