UPDATE 2-European shares rise on vaccine hopes; Brexit talks eyed

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* FTSE leads gains in Europe, up 1.9%
* Unicredit slides after CEO steps down
* French, German factory activity slips in November
* Still chances of Brexit without a trade deal - British
Minister

(Updates to close)
By Susan Mathew
Dec 1 (Reuters) - European shares made a positive start to
the month on Tuesday following record-breaking gains in
November, with optimism around a coronavirus vaccine
strengthening the case for economic recovery.
Hopes the pandemic might end soon came from Pfizer PFE.N
and BioNTech BNTX.O seeking emergency approval from the
European regulator of their vaccine candidate, neck-and-neck
with Moderna MRNA.O , which announced it would ask the
regulator to recommend conditional approval for its shot.
MKTS/GLOB
After a day's dip when investors took some profits, the
pan-European STOXX 600 index .STOXX was back in the black, up
0.7%. The index ended November with gains of nearly 14%.
Gains were largely broad-based with basic materials .SXPP
in the lead as robust China factory activity data buoyed copper
and iron ore prices. Defensive plays such as healthcare .SXDP
and utilities .SX6P lagged. IRONORE/ MET/L
After marking its best month in over three decades, London's
blue-chip index .FTSE rallied 1.9% to post its best day in
three weeks, propelled by data showing improving confidence and
the UK's fastest growth in factory activity in three years. .L
Elsewhere in Europe, impacts of lockdowns to curb the spread
of COVID-19 continued to be felt, with manufacturing activity in
France and Germany slowing in November. "More stringent restrictions and tougher fiscal
conversations should keep growth (in Europe) subdued, even if
there is catch up potential," said Esty Dwek, head of global
market strategy at Natixis Investment Managers Solutions, adding
that expectations are for a weak first quarter.
Some European nations are set to cautiously lift
coronavirus-induced curbs put in place to control the spread of
the novel coronavirus, while the European Central Bank's meeting
next week will be eyed for policy easing especially after
Tuesday's data showing dropping inflation. "Europe should be one of the beneficiaries of the reopening
trade, as indices remain well below the U.S. and well below
pre-crisis levels, Dwek said. "The EU Recovery Fund and
additional ECB support should help with sentiment, supporting a
recovery in financials among others."
On the Brexit front, a senior British minister said on
Tuesday there was still a chance of a turbulent exit from the
European Union without a trade deal, as talks had snagged on
fishing, governance rules and dispute resolution. Among stocks, Italian lender Unicredit SpA CRDI.MI logged
its worst day since March, sliding 8% after it said Chief
Executive Officer Jean Pierre Mustier will step down in April
next year over disagreements with the board.