UPDATE 2-European shares touch all-time high as trade, Brexit fog clears

* STOXX 600 trounces previous high hit in April 2015

* FTSE 100 marks best day since Dec 2018

* Electrolux slumps on profit warning

* Investors shrug off underwhelming PMI readings
(Adds comments, updates price action)

By Sruthi Shankar and Shreyashi Sanyal

Dec 16 (Reuters) - European shares hit record highs on
Monday, rising for the fourth successive session as a
preliminary U.S.-China trade deal helped extend a rally sparked
by the British Conservative Party's election victory.

London's FTSE 100 jumped 2.3%, leading gains among
regional indexes, as investors took British Prime Minister Boris
Johnson's election triumph last week as a signal to buy back
into a market that has underperformed on concerns over Brexit.

Shares of big dollar earners such as British American
Tobacco, Glencore and BHP rose
between 3% and 5%. Banks exposed to Brexit uncertainties,
including Royal Bank of Scotland and Barclays
also rose.

Bearish bets unwound even as the pound, whose gains tend to
weigh on the exporter-heavy FTSE 100, extended its rise to above
1.33 per dollar.

"We are witnessing a realignment of British politics and
investment," Steven Holden, CEO of Copley Fund Research, wrote
in a note to clients. "Down in the dumps and forgotten British
brands are suddenly positioned to ride a wave of new-found
confidence."

Gains for London, along with general optimism over the
U.S.-China trade deal, drove the pan-European STOXX 600 index
to a record high. The index was up 1.4% at 417.75,
logging a new closing high.

"I think we have seen the majority of the good news being
priced in today, we would now need new input for further
significant gains," said Teeuwe Mevissen, Senior Market
Economist at Rabobank in Amsterdam.

Trade-sensitive miners rose after Washington said a
"phase one" U.S.-China trade deal will nearly double U.S.
exports to China over the next two years and is "totally done".

Germany's DAX lagged its European peers, with
automaker Volkswagen weaker.

Markit's Purchasing Managers' index, released earlier,
showed German private sector activity shrank for the fourth
successive month in December as a downturn in manufacturing
offset services sector growth.

Investors also overlooked lacklustre data from the euro zone
and the United Kingdom as the focus remained on trade and Brexit
- two factors that have weighed on global markets this year.

Swedish appliance maker Electrolux AB tumbled
10.6% after warning that its North American business would take
a bigger-than-expected hit, partly because of costs from its
move into a new plant in South Carolina.

Tullow Oil slid 10.2% after S&P Global downgraded
its long-term credit rating, days after the company's chief
executive officer stepped down and it scrapped its dividend.
(Reporting by Shreyashi Sanyal and Ambar Warrick in Bengaluru;
Additional reporting by Sruthi Shankar and Josephine Mason in
London; Editing by Nick Macfie and Timothy Heritage)