Death denial halts Fiat rally

Italian carmaker Fiat has denied rumours that its honorary chairman Giovanni Agnelli is dead, dampening a rally in the company's shares.

Fiat shares, which had jumped one euro higher to 13.22 euros in response to the rumours earlier on Tuesday, fell back to close 0.25% higher at 12.58 euros

Investors had snapped up Fiat shares, betting that the rumours of Mr Agnelli's death, if true, would make a disposal of Fiat's loss-making car division more likely.

Mr Agnelli, Fiat's 81-year old former chairman, is thought likely to resist moves to sell off the car division.

The Agnelli family controls about 30% of the company's shares.

Fiat has extensive interests in the automotive, insurance and energy industries.

But Fiat's car division, which accounts for about 40% of the company's sales, racked up an operating loss of 549m euros last year.