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* STOXX 600 rises 1.5 percent to one-week high
* Miners, healthcare, financials underpin market
* Trump plans to boost spending, cut tax lifts sentiment
* But Mexican-exposed, renewable energy stocks under pressure
* Italian stocks lag as referendum risk back in focus
By Danilo Masoni and Alistair Smout
MILAN/LONDON, Nov 9 (Reuters) - European shares surged on Wednesday after the surprise victory of Donald Trump in the U.S. presidential election sparked a sharp reversal driven by gains among drug makers and financial stocks.
The pan-European STOXX 600 index fell as much 2.4 percent in early trade on uncertainty over Trump's policy positions but the index recovered progressively to end up 1.5 percent at 339.8 points, its highest closing level since Oct 31.
As the market rallied off its lows, traders cited Trump's conciliatory acceptance speech and later in the session investors focused on his plans to boost infrastructure spending and cut corporate tax, both moves seen as positive for stocks.
"The most important thing for the equity market is a smoothness of transition and it's clearly there. Trump won and Clinton conceded," said Peter Rosenstreich, Head of Market Strategy at Swissquote Bank in Geneva.
"Trump has promised an enormous amount of business-friendly platforms such as infrastructure spending, rolling back regulation and lowering tax. That's extremely positive if it happens," he added.
The Basic Resources index was the biggest sectoral gainer, up 6.6 percent, boosted by a 7-11 percent jump in Fresnillo, Antofagasta and Glencore.
Shares in the industry tracked a sharp rise in prices of gold, generally seen as a safe-haven asset, while base metals surged on hopes Trump could put in place fiscal stimulus.
Healthcare stocks surged 4.6 percent in a relief rally following recent losses due to concerns that Clinton could impose tighter regulation on prices.
Europe's Aerospace and Defence Index surged 4.4 percent on expectations that Trump's presidency would trigger a rise in defence spending in European countries. Trump has suggested the United States might not be willing to protect NATO allies that failed to spend enough on their own defence.
Among top fallers on Wednesday was Spanish bank BBVA , down 6.1 percent, hit by a slump in the Mexican peso after Trump's victory. Among European banks, BBCA has the biggest Mexican revenue exposure of all European banks.
However, the banking index rose, mirroring gains in their U.S. peers and expectations that the Federal Reserve would still hike rates in December, a move that could ease pressure on bank margins.
Among other stocks with links to Mexico, Tate & Lyle slumped 11 percent, weighed down by a downgrade to underperform from neutral by Exane, which said its exposure to the Latin American country will weigh on profits and sentiment
Italian stocks underperformed, with the FTSE MIB down 0.1 percent. Traders said the shock election of Trump, following on from Britain's vote to leave the European Union in June, had increased jitters over a constitutional referendum in next month. Prime Minister Matteo Renzi and his reformist agenda are expected to be undermined if the "no" campaign prevails.
"Like Brexit, Trump is a symptom of electorates wanting to break with the old elites ... The protest vote is spreading across Europe too, and each success reinforces another campaign. The Italian referendum is unfortunately taking shape as a protest vote too, and this slightly increases the chances of a No," said Alberto Gallo, Fund Manager and Head of Macro Strategies at Algebris Investments.
Shares in Vestas, the world's biggest wind turbine maker, was the biggest STOXX loser, as renewable stocks were hit by fears over Trump's aim to promote oil and gas drilling and revive the U.S. coal mining industry. (Reporting by Danilo Masoni; Editing by Gareth Jones)