European stocks gain amid US holiday

European share prices rose on Monday with London hitting a near five-year high in light trading amid a public holiday in the United States, although the luxury goods sector was tarnished by a gloomy outlook from the Swiss group Richemont. London's FTSE 100 index of top companies gained 0.43 percent to 6,180.98 points, a level unseen since May 2008. Frankfurt's DAX 30 rose 0.61 percent to 7,748.86 points, and in Paris the CAC 40 added 0.57 percent to 3,763.03 points, with dealers pointing to hopes for an agreement on the US debt ceiling. In foreign exchange deals, the European single currency was stable at $1.3317 while on the London Bullion Market, gold prices edged lower to $1,687.50 an ounce from $1,688.50. Wall Street was closed for Martin Luther King Day, and as US President Barack Obama took the oath of office to start his second four-year term in Washington. "Despite fairly low volumes due to a US holiday, Europe’s markets have continued to edge higher with the FTSE 100 hitting a new five year high, helped by the absence of any meaningful economic or other data related news flow," said Michael Hewson, Senior Market Analyst at CMC Markets UK. He said investors appeared to sitting on the sidelines ahead of economic data due out later this week a slew of company earnings reports including Google, Apple and Microsoft. Europe's luxury goods sector slid after Richemont -- owner of brands like Cartier jewelry and Montblanc pens -- said in an update that it was "unclear" how business patterns would develop in the near future, particularly in Asia which has driven growth in the sector in recent years. In reaction, shares in the French luxury goods groups LVMH and PPR slid by 1.03 percent and 0.26 percent in Paris, to stand at 140.00 euros and 155.25 euros, respectively. In London, luxury accessories and handbag maker Burberry shed 1.37 percent to 1,367 pence. Shares in British publisher Pearson dived 2.91 percent to 1,202 pence after it announced that profits would remain flat, ahead of next month's annual results statement. "Traders will also keep an eye out on headlines from Brussels are euro-area finance ministers meet with the discussion mostly likely to centre the recent bailout of Cyprus," said ETX Capital analyst Ishaq Siddiqi. In Paris, shares in airline Air France-KLM surged by 3.99 percent to 8.418 euros on a recommendation from brokers at Credit Suisse, while shares in Carrefour supermarkets leapt by 2.57 percent to 20.74 euros, also on a note from Credit Suisse. In a sign that investors are starting to search for return instead of a safe haven, a French auction of short-term debt didn't feature negative rates of return for the first time since July. Meanwhile, French-based investment manager Carmignac Gestion called on the European Central Bank for additional easing measures to insure the euro doesn't rise as central banks in Japan and the United States pump more money into their economies. Carmignac also urged the EU to slow its debt-cutting drive for nations implementing structural reforms and for EU nations to cap personal tax rates at 50 percent to make Europe attractive to entrepreneurs. Asian markets were mixed, with Tokyo's Nikkei hit by a stronger yen and profit-taking after last week's rally, while dealers await the outcome of a policy meeting at the Bank of Japan. Tokyo's Nikkei, which hit a 33-month high Friday, fell 1.52 percent. Sydney closed up 0.13 percent, while Seoul ended flat and Hong Kong was also barely changed. Chinese shares meanwhile rose 0.48 percent, extending Friday's gains after Beijing released data showing the economy grew faster than expected last year. Policymakers at Japan's central bank on Monday began a two-day meeting that markets widely expect will see them adopt a two percent inflation target and unveil more monetary easing. The yen has tumbled in recent months -- sending the stock market surging -- since Shinzo Abe promised before December's election that he would urge the bank to be more aggressive in its battle to save the economy. Abe swept to power in the poll and has since moved to bring BoJ policies into line with his new government's position.