European stocks rise sharply, led by commodities

FRANKFURT, Dec 8 (Reuters) - European shares soared 6.7 percent on Monday, led by commodities and banks, on optimism that government stimulus packages will help soften the impact of a recession.

The pan-European FTSEurofirst 300 .FTEU3 index unofficially closed up 53.32 points higher at 847.26, having extended gains after U.S. stock markets opened higher.

U.S. president-elect Barack Obama said on Saturday that his plan to create at least 2.5 million new jobs included the largest infrastructure investment since the 1950s and a huge effort to reduce U.S. government energy use.

Wall Street rallied on hopes for the plan, and major U.S. indexes were up between 3.6 and 3.7 percent as the European market closed.

Commodity stocks led the rally in Europe, tracking metal and crude prices, which rose sharply. The DJ Stoxx basic resources index was up 13.4 percent, with Anglo American (AAL.L: Quote, Profile, Research, Stock Buzz), Vedanta Resources (VED.L: Quote, Profile, Research, Stock Buzz) and BHP Billiton (BLT.L: Quote, Profile, Research, Stock Buzz) rising between 13.2 and 15.6 percent.

Heavily-weighted banks also advanced. Barclays (BARC.L: Quote, Profile, Research, Stock Buzz), Lloyds TSB (LLOY.L: Quote, Profile, Research, Stock Buzz), Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz) and UBS (UBSN.VX: Quote, Profile, Research, Stock Buzz) rose between 6.7 and 14.2 percent. (Reporting by Sarah Marsh, editing by Atul Prakash)