Frankfurt DAX: 2570.78 (+20.78)

German shares hit a record high and analysts said there was further upside potential in the 30 share DAX index, with some upgrading their 1996 forecasts from 2,600 points to 2,700.

In floor trade, the index hit a record high of 2,571.75 points, while IBIS electronic trade saw all time highs at 2,572.51 points.

Paris CAC-40: 2129.71 (+9.12)

French shares closed firmer, bolstered by foreign buying and positive comments by Bundesbank vice president Mr Olaf Sievert. Some fund managers believe that the market is set for a rally after three weeks of hesitation.

Milan Mibtel: 10670 (-28)

Italian shares held at their lower levels ahead of further city inflation figures, with a lower Wall Street opening giving little encouragement to the market.

Shares were also on hold ahead of Prime Minister Mr Romano Prodi's speech today, outlining his new government's policies.