Europe shares inch up in quiet pre-holiday session
* FTSE 100 up 0.4 pct, CAC 40 up 0.3 pct, closing at midday
* Germany, Switzerland, Italy closed for the day
* Italy still down 58 pct from 2007 peaks
* Brisk inflows going into European equities
PARIS, Dec 24 (Reuters) - European stocks inched up on Tuesday morning, adding to a sharp rally in the past four sessions, although trading in the shortened session was thin.
Many stock markets such as Germany, Switzerland and Italy were closed for the Christmas break.
At 0900 GMT, Britain's FTSE 100 index was up 0.4 percent, France's CAC 40 up 0.3 percent, and Spain's IBEX up 0.5 percent.
After an hour of trading, volumes were extremely low, representing about 5 percent of a daily average volume for both the FTSE 100 and CAC 40, and 12 percent for the IBEX.
With just a few sessions remaining before the end of the year, European shares have gained about 15 percent so far in 2013, mostly propelled by central banks' massive liquidity injections as well as an improvement in economic data from both Europe and the United States.
"The rally should continue next year, Europe still has a big potential for a catch-up rally versus Wall Street," Saxo Bank sales trader Andrea Tueni said.
While Wall Street's Dow Jones industrial average and S&P 500 as well as Germany's DAX trade at all-time highs, other euro zone stock indexes, hammered during the region's sovereign debt crisis, are still well below highs hit in 2007.
France's CAC 40 is still about 32 percent below peaks seen before the global financial crisis, while Spain's IBEX is down 39 percent and Italy's FTSE MIB down 58 percent.
As fears over Italy and Spain receded in 2013 and volatility dropped, European equities saw a return of investment flows from global investors in the second part of the year.
According to data from fund-tracking EPFR Global, European equity funds have enjoyed net weekly inflows in the past 25 weeks in a row.
In the week ending Dec 18, even as investors pulled $3.4 billion from global equity funds in the run-up to the U.S. Federal Reserve's decision to start trimming its massive stimulus, investors continued to pour in money into European stocks, EPFR data showed.
London's stock market will close at 1230 GMT on Tuesday, while Euronext markets in Paris, Amsterdam, Lisbon and Brussels will close at 1300 GMT. Madrid will also close at 1300 GMT.