Reassuring US economic data helped European shares clock up fresh gains yesterday, while technology issues such as Nokia were buoyed by bullish comments from rival handset maker Motorola.

But oil prices edging back towards record highs trimmed market gains late into the session.

Heavyweight insurer Allianz lent support, up 2.3 per cent its Dresdner Bank unit forecast tripled profitability by 2009, while Scor added 4.7 per cent as the French reinsurer said Hurricane Charley would have a relatively small impact on its earnings.

Other bright spots included Amadeus, which jumped 10 per cent after the Spanish-based global travel bookings firm said it had attracted interest from financial investors. The statement came after banking sources said Amadeus was talking to private equity firms about a whole or partial leveraged buyout.

Shares in three stakeholders in the group, Air France, Iberia and Lufthansa all rallied. The FTSE Eurotop 300 index edged 0.12 per cent higher to end unofficially at 951.45 points.

Sentiment was boosted by an unexpected drop in US consumer prices in July, the first decline in eight months, prompting investors to scale back forecasts for growth-crimping interest rate rises in the world's biggest economy.

The US consumer price index fell 0.1 per cent in July, while core inflation, which excludes volatile food and energy, rose 0.1 per cent. Economists had expected CPI to have risen a modest 0.1 per cent and core consumer price index (CPI) to have climbed 0.2 per cent.

"More subdued core inflation readings over the summer justify the Fed's measured approach to rate hikes," said SG economist Stephen Gallagher.