(Updates prices, adds detail)
* FTSEurofirst 300 up 0.7 pct, FTSE 100 up 0.2 pct
* FTSE underperforms due to weaker mining stocks
* Volumes thin due to holiday season
* Italy's Prysmian rises on Bahrain contract win
By Sudip Kar-Gupta
LONDON, Dec 29 (Reuters) - European stock markets rose on Tuesday, helped by gains in the banking sector, although weaker mining share prices curbed the progress of the British market.
The pan-European FTSEurofirst 300 index rose 0.7 percent while the euro zone's blue-chip Euro STOXX 50 index advanced 1.2 percent.
Britain's blue-chip FTSE 100 index rose 0.2 percent, underperforming bigger gains of 1.3 percent on Germany's DAX and 1.2 percent on France's CAC.
The London market's relative underperformance was due to a fall in mining stocks, which account for around 5 percent of the FTSE's overall market capitalisation.
The mining sector lost ground on Tuesday as copper and aluminium prices fell on concerns about demand from China, which is the world's biggest consumer of metals..
"The UK index is struggling to match its euro zone peers, hampered by the mining sector," said Spreadex analyst Connor Campbell.
With many traders away for the Christmas holiday season, trading volumes were just a fifth of the FTSEurofirst's three-month daily average.
Deutsche Bank rose 1.8 percent following its move to sell its 20 percent stake in China's Hua Xia Bank to insurer PICC Property and Casualty Co for up to 25.7 billion yuan ($4 billion).
Deutsche Bank's share price rise enabled the STOXX Europe 600 Banking Index to advance 0.5 percent.
Italian cable systems company Prysmian also outperformed, rising 3.2 percent after announcing a new contract win in Bahrain.
Naeem Aslam, chief market analyst at brokerage AvaTrade, said European stocks looked well-placed for 2016, given measures by the European Central Bank to support the euro zone economy.
"European markets still remain the place to invest, with the ECB pumping more money into the system," said Aslam.
The FTSE is down by around 4 percent since the start of 2015, underperforming a rise of 6 percent on the pan-European FTSEurofirst 300 index. (Editing by Dominic Evans)