Milan, September 10 - European markets jumped to three-month highs Tuesday after an apparent easing in tensions in the Syrian conflict and even Milan, rocked by government uncertainty, managed to show significant gains. The FTSE-Mib climbed by 0.51% to close trading at 17,332 points while the spread between Italian and German bond rates narrowed slightly on the day, despite growing tensions between the two political parties in Italy's governing coalition. The coalition was hanging by a thread Tuesday with each party blaming the other for a looming collapse linked to ex-premier Silvio Berlusconi's first definitive criminal conviction. Berlusconi's People of Freedom (PdL) party warned that Democratic Party (PD) Premier Enrico Letta's government will fall if a Senate panel rejects PdL efforts to delay a vote to strip Berlusconi of his parliamentary seat over his tax-fraud conviction. Berlusconi risks losing his Senate seat under the terms of an anti-corruption law approved in 2012, which the PdL says is unconstitutional. Despite the Italian uncertainty, investors were encouraged by solid economic news from China, which showed that industrial production rose 10.4 % in August, up from 9.7% reported in July and above expectations of a 9.9% increase. As well, Chinese retail sales jumped by 13.4% suggesting a renewed vigour in the massive economy. Meanwhile, in the Syrian conflict, investors breathed a sigh of relief following suggestions that Syrian President Bashar al-Assad could avoid a military attack if he were to surrender all chemical weapons to the international community. Further, United States President Barack Obama said that he would put airstrikes on hold if the US itself verified the handover of chemical weapons. The news calmed bond markets as the spread between Italy's 10-year bond and its German counterpart narrowed to 250 basis points by end of trading Tuesday, down from Monday's close of 256 basis points. The yield on Italian 10-year paper closed at 4.53%. The spread between lending rates in the two countries is seen as an indication of investor faith in the Italian economy and its ability to cope with a lingering recession. On other European markets, Spain's IBEX 35 gained fully 1.96% to 8,801.50 points while Frankfurt's DAX jumped by a dramatic 2.1% to close at 8,446.54 points. In Paris, the CAC 40 gained 1.90% to close at 4,116.64 points, and in London, the FTSE index of leading British shares gained 0.82% to close at 6,583.99.