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European stocks cautious as commodities, tech stocks pull higher

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European stocks cautious as commodities, tech stocks pull higher
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LONDON (Reuters) – European stocks edged higher on Wednesday, underpinned by gains in tech and commodity-related stocks, although trading was cautious amid worries over Italian debt and global trade.

The pan-European STOXX 600 <.STOXX> index was up 0.1 percent by 0720 GMT, while Germany’s DAX <.GDAXI> advanced 0.2 percent and Britain’s FTSE <.FTSE> rose 0.3 percent.

Investors have shifted focus from concerns over trade tariffs and Italian politics to the supportive backdrop of global growth for equities, which lifted shares in cyclical sectors.

Basic resources <.SXPP> and energy stocks <.SXEP> supported the market as underlying oil prices rose and copper also gained.

Tech stocks <.SX8P> remained close to the previous session’s 17-year high, joining in a global rally which saw the U.S. Nasdaq index end at a record close.

Italian stocks <.FTMIB> were down 0.2 percent as concerns over the new coalition government’s big spending plans resurfaced on Tuesday after Prime Minister Giuseppe Conte promised radical change.

Banking stocks <.SX7P> gave up early gains to trade slightly lower. The sector came under pressure last week as Italy struggled to form a government.

Among individual stocks, RPC <RPC.L> was the biggest faller, tumbling 10.3 percent after the plastic packaging leader said it was looking to sell assets.

Also in the packaging sector, shares in Smurfit Kappa <SKG.I> recovered some of yesterday’s losses, up 2.4 percent, after International Paper <IP.N> confirmed that it will not make a bid for the Irish company.

(Reporting by Kit Rees; Editing by Raissa Kasolowsky)

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