European shares set to extend two-week rally, led by Italy
* FTSEurofirst 300 up 0.4 pct
* China investment promise boosts basic resources
* Italy shines; FTSE MIB at highest since May 2011
* Insurers suffer from threat of investigation (Adds detail, quote, updates prices)
By Alistair Smout
LONDON, March 28 (Reuters) - European shares rose on Friday and looked set to gain for a second straight week after basic resources stocks got a boost from China. Italian stocks continued to outperform.
The pan-European FTSEurofirst 300 was up 0.4 percent at 1,327.64 at 1130 GMT, 1.6 percent higher on the week.
The rise took gains over the last fortnight to 3.4 percent, but the index remains 1.8 percent below the 5 1/2-year high it reached in February. It fell 1.6 percent in March amid concerns about Ukraine, slower Chinese growth and the possibility U.S. interest rates will rise sooner than expected.
However, recent weakness in China led Chinese Premier Li Keqiang to say Beijing was ready to support the cooling economy and would push ahead with infrastructure investment. That helped the STOXX Europe 600 Basic Resources Index to climb 1.1 percent, making the sector one of the biggest risers in Europe. Continuación...