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STOCKS NEWS EUROPE-UK small caps outperform early on

The FTSE Small Caps index gains 0.2 percent in early trade, outperforming weaker showings by both the FTSE 100 and FTSE 250 indexes, down 0.3 percent and 0.4 percent respectively.

Flybe gains 7.5 percent as Europe's largest regional airline says it performed in line with revised management in the second quarter, and as it said it has now formally signed a contract with Finnair to fly 12 Embraer E190 regional jets on its behalf.

Morgan Sindall adds 2.2 percent as the UK construction and regeneration group says it has been appointed preferred delivery partner for a 1.1 billion pounds contract at the Sellafield nuclear reprocessing plant.

Reuters messaging rm://jon.hopkins.thomsonreuters.com@reuters.net

Keywords: MARKETS EUROPE STOCKSNEWS