UPDATE 2-European shares hit more than 4-year peak on trade hopes

* STOXX 600 up 0.2%
* Optimism around U.S.-China trade deal buoys stocks
* Euro zone services PMI awaited
* Pandora , Siemens Gamesa tumble on weak outlook
* Dufry, Associated British Foods jump on strong results

(Updates prices)
By Susan Mathew
Nov 5 (Reuters) - European shares hit more than four-year
highs on Tuesday, edging closer to record highs, driven by a
rally in energy and commodity-linked stocks as U.S.-China
trade-related optimism boosted risk appetite.
China is pushing U.S. President Donald Trump to remove more
tariffs as part of a "phase one" trade deal, which may be signed
this month - a first step to ending a 16-month long trade war.
Mining companies .SXPP rose 1.7%, extending gains for a
third session, while rising oil prices bolstered a rally in
energy stocks .SXEP . Banks continued their wining streak,
ending higher for a fourth day in five. O/R
"Hopefully we'll get a deal (next week) and get some line of
sight into talks beyond the phase one deal, what it means for
the December tariffs. There is little bit of scope for output
momentum continuing over that period," said David Page, senior
economist at AXA Investment Managers.
"European stocks have been caught very much in that big
spat, so I think there is lot of positivity in the markets."
The pan-European STOXX 600 index .STOXX closed up 0.2% at
their highest since July 2015. AXA's Page said the focus on
Wednesday will be on euro zone services PMIs.
"I think we would be surprised to see services PMI fall back
materially. We'll watch the data very much with the view that
other economies are suggesting that we're not seeing a
significant roll over of a slowdown in the manufacturing sectors
in Germany and Italy to non-manufacturing."
But a clear move out of defensive stocks .SDEFN and into
cyclicals .SCYC was evidence of risk appetite among investors.
Healthcare .SXDP , utilities .SX6P and real estate .SX86P
stocks, recorded some of the biggest losses on the day.
Steep declines in some stocks after weak quarterly results,
also limited gains.
More than half of European companies have already reported
results, with most of them beating analysts'
estimates. Shares of Swiss airport retailer Dufry DUFN.S and
Associated British Foods ABF.L topped STOXX 600 after
reporting strong third-quarter results. But Pandora PNDORA.CO fell 17.6%, its worst day in more
than a year as it warned of a steeper-than-expected fall in
sales this year.
German-Spanish company Siemens Gamesa SGREN.MC tumbled
8.7% to its lowest level since January after lowering its
forecast for 2020. SAP SAPG.DE dropped despite news that Europe's most
valuable tech company would return an extra 1.5 billion euros to
shareholders next year.