The FTSE Eurofirst 300 added 0.1 percent to 1,468.30 on Tuesday on light trade.

Among gainers on the day was Alitalia, which gained 3 percent to €0.986 on speculation that the Italian airline could hook up with international carriers.

Consumer goods company Henkel was 3.8 percent higher to €112.28 on a target share price upgrade from Merrill Lynch, which also repeated its “buy” recommendation citing growth in sales. The broker raised the German company’s target share price from €100 to €127.

Bancha Monte dei Paschi di Siena added 1.3 percent to €4.89 when French insurance company CNP Assurances revealed that it is interested in bidding for the Italian bank’s insurance unit, MPS Vita. CNP added 0.2 percent to €82.15 on the news.

Danone was 1.9 percent higher to €119.00 after Goldman Sachs issued a “buy” recommendation for the French foods group on the basis of growth that was outpacing the sector.

Luxury goods group Richemont added 1.4 percent to SFr66.65 on an improved full-year earnings forecast from Goldman Sachs. The upgrade came after Richemont announced on Friday that profits were up 22 percent in the first half.

Deutsche Borse was up 3 percent to €129.74 after speculation surfaced that it might be interested in bidding on Spanish exchange BME now that the German exchange has withdrawn its bid for Euronext. BME gained 7.4 percent to €29.95 on the rumors.

In Europe on Tuesday, the FTSE Eurofirst 300 dropped 0.6 percent to 1,444.16 as banks saw losses.

UBS dropped 5.1 percent to SFr74.30 after it said it saw net profits drop by 21 percent in the third quarter. It still insisted, however, that sentiment has improved and it will fulfill expectations for full-year profits. Credit Suisse was also lower, falling 1.3 percent to SFr75.

Also down on its quarterly report was Sanofi-Aventis. The pharmaceuticals company dropped 2.8 percent to €66.60 on the news that profits fell 11.6 in the third quarter, about as much as had been expected.

Things were better in the automobile manufacturing sector. DaimlerChrysler added 3.1 percent to €44.70 after a German publication reported that a spin-off of the Chrysler unit was not being ruled out by the carmaker, a rumor that not all analysts were buying. Elsewhere in the sector, Fiat was 1.1 percent higher to €13.84 and Renault gained 1.2 percent to €91.65.

European insurers were also higher after a positive third-quarter report sent Friends Provident up 6.7 percent in the UK. Generali added 1.4 percent to €31.09, while CNP Assurances was up 1.7 percent to €82.45.

In the construction sector, Spanish builder Ferrovial was 5.1 percent higher to €72.40 on the announcement that its toll roads unit had acquired a road in Chile.

The FTSE Eurofirst 300 was up just 0.1 percent to 1,399.35 on the day Monday as the oil sector was weak on declining crude oil prices but insurance companies and banks did well.

The oil sector was down 1.5 percent as a whole. Statoil dropped 3.1 percent to NKr20 not only on lower oil prices but on a quarterly earnings report that did not meet expectations even though its operating profits were up by a reported 44 percent. Norsk Hydro was down 3.2 percent to NKr940. OMV declined by 5.1 percent to €53.40 despite saying that it is in talks with Verbund, Austria’s biggest utility. Neste Oil was down 4 percent to €27.75. Oilfield services company Saipem was down 2.3 percent on the day to €20.16.

In the insurance sector, CNP Assurances was up 4.3 percent to €92.90 after last week’s upgrade from West LB. Axa, another French insurer, added 1.2 percent to €30.36 after Bear Stearns reiterated its “outperform” rating. Axa is expected to release its quarterly report on Thursday. Meanwhile, Merrill Lynch raised its target share price on Zurich Financial from SFr350 to SFr365, sending Zurich up 1.9 percent on the day to SFr315.

Credit Suisse was up 0.3 percent to SFr77.90, Deutsche Bank added 0.4 percent to €99.20, and UBS was up 1.1 percent to SFr150.60 in a day of advances in the banking sector. ABN Amro gained 1.7 percent to €23.39, while UniCredit was up 1.9 percent to €6.22. But the star performer of the day was Banca Monte dei Paschi di Siena. On upgrades from Credit Suisse and Morgan Stanley, the Italian bank gained 3.5 percent on the day to €4.8760. Credit Suisse upped its rating on the bank from “neutral” to “outperform” on what it called its “restructuring potential”. Morgan Stanley based its upgrade, from “underweight” to “equal weight” on good earnings coupled with cost cutting and reduced credit charges.