The market was also tempered by a 6.0% drop in AstraZeneca shares, after the drugmaker agreed Saturday to buy US biotech firm Alexion for a hefty $39 billion (32.2 billion euros), sparking investor concerns about the high price tag.
Frankfurt stocks jumped 1.2% and Paris gained 1.1% in early afternoon eurozone deals.
- 'Go the extra mile' -
"European equity markets are showing gains as British-European trade discussions continue," said CMC Markets analyst David Madden.
Prime Minister Boris Johnson and EU chief Ursula von der Leyen said after a crisis call that they would "go the extra mile" to find common ground in long-running talks between Brussels and London.
"Our negotiating teams have been working day and night over recent days," said von der Leyen, reading a joint statement agreed with Johnson as their Sunday deadline passed, with sticking points on issues including fishing rights and fair trade regulations.
"We have accordingly mandated our negotiators to continue the talks and to see whether an agreement can even at this late stage be reached."
The news gave the pound a boost against the dollar and euro, though Johnson warned a deal was far from sure with less than three weeks until Britain leaves the single market on December 31.
"I'm afraid we're still very far apart on some key things, but where there's life there's hope," he said.
The talks between the EU and Britain were showing "some progress", according to OANDA analyst Craig Erlam.
"It does seem like some progress is being made and with neither side willing to be the ones to call off the talks; a minute-to-midnight compromise looks likely," Erlam said.
"This is a negotiation after all and there's nothing to be gained by showing your hand at this point."
- Digging heels in -
Investors are also keeping tabs on Capitol Hill, where lawmakers are still battling to hammer out a fresh stimulus for the beleaguered US economy, with hope they can reach a deal before the end of the year.
However, with both sides digging their heels in, analysts said there were worries about their chances of success.
Still, the rollout of vaccines is keeping traders optimistic, even as surging infections force governments to impose strict containment measures, with Germany the latest to announce a lockdown.
US regulators gave the go-ahead for the use of the Pfizer-BioNTech vaccine on Friday and officials said 20 million Americans could receive a first of two required injections by the end of the year and 100 million by March.
This story has been published from a wire agency feed without modifications to the text.
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