LONDON - Aerospace and defence stocks helped drive Britain's top share index higher with investors relieved over the formation of a new government, while outsourcing companies were also in demand.

The FTSE 100 index closed up 49.24 points, or 0.9 percent, at 5,383.45, having fallen one percent on Tuesday.

@MARKET ROUNDUP:EUROFIRST

EUROPE - European shares gained as strong results from financials such as Allianz and ING Groep and Spain's plan to cuts its deficit lifted investor sentiment.

The pan-European FTSEurofirst 300 index of top shares closed up 1.3 percent higher at 1,048.56 points. The index is now up 0.3 percent for the year having dipped into negative territory in early May on euro-zone sovereign debt concerns.

@MARKET ROUNDUP:EUROmarkets

FRANKFURT - The DAX index ended at 6,183.49 points, up 145.78 or 2.41 percent.

PARIS - The CAC-40 index closed at 3,733.87 points, up 40.67 or 1.1 percent.

ZURICH - The Swiss market index closed at 6,575.05 points, up 66.05 or 1.01 percent.

MILAN - The FT IT All Share index closed at 21,626.38 points, up 180.41 or 0.84 percent.

@MARKET ROUNDUP:nikkei

TOKYO - Japan's Nikkei average slipped 0.2 percent, erasing earlier gains as concern about the euro zone's debt woes continued to weigh on market confidence even after a $1 trillion European rescue package.

The Nikkei closed down 17.07 points at 10,394.03, after rising nearly one percent at one stage.

@MARKET ROUNDUP:hang seng

HONG KONG - Hong Kong stocks ended slightly higher, pulling back from the red, but gains were capped as weak overseas markets, lingering euro zone concerns and China tightening risk offered little encouragement to investors who appear to be firmly in flight-to-safety mode. The Hang Seng closed up 66 points at 20,212.49 with turnover on the Hong Kong stock exchange at its lowest in six sessions.

@MARKET ROUNDUP:asx

MELBOURNE - Australian shares rose 0.6 percent, recovering some of the prior day's losses as upbeat budget forecasts supported prospects of further business investment and consumer spending. The S&P/ASX 200 index rose 25.1 points to 4,572.9. The index had dropped 1.1 percent on Tuesday.

@MARKET ROUNDUP:south africa

JOHANNESBURG - South African miners rode metal prices higher and reports of a Standard Chartered bid for Nedbank drove Johannesburg's bourse to a near two-week high.

The All-share index closed at 28,178.23 points, up 664.25 or 2.41 percent.