Banks and commodities lead European shares higher

 

European shares rose in early trade on Tuesday, with banks and commodity stocks gaining, after a rally on Wall Street and on hopes that euro zone finance ministers are making progress with details of a rescue package.

At 9:23 a.m., the FTSEurofirst 300 index of top European shares was up 0.8 percent at 1,020.71 points, after falling 0.1 percent in the previous session.

The index is down more than 8 percent from mid-April on fears about a debt crisis in the euro zone, but is still up more than 58 percent from its lifetime low of March 9, 2009.

Banks added most points to the index on Tuesday. BNP Paribas , Banco Santander, BBVA, Credit Agricole and Societe Generale

rose between 2.1 and 3.8 percent.

Euro zone finance ministers aim to rapidly iron out wrinkles in the 750 billion euro (643 billion pound) plan they hatched a week ago to calm markets and stem fears of Greece's debt problems spreading to other countries in the currency area.

"The ECB has clarified its intervention" said Bernard McAlinden, investment strategist at NCB Stock brokers in Dublin. "The market is less concerned that the ECB is engaged in outright money printing.

Energy companies gained, as crude oil prices continued to bounce from the five-month lows hit on Monday, helped by strong Chinese demand.

The euro's recovery from a four-year low against the dollar late on Monday helped, though it weakened again on Tuesday.

Total, ENI, Repsol and Statoil Hydro rose between 1.3 and 1.8 percent.

BP rose 1.6 percent, on optimism it was finding a solution to an oil leak in the Gulf of Mexico.

Metals prices also recovered, with copper up from the three-month lows of Monday. Miners Anglo American, Antofagasta, Kazakhmys, Rio Tinto and Xstrata rose between 1.9 and 3.1 percent.

Across Europe, the FTSE 100, Germany's DAX and France's CAC40 rose between 0.8 and 1.5 percent.

BRITISH LAND GAINS

British Land rose 4.3 percent after booking the first full-year mark-up in its portfolio since the UK property bubble burst three years ago.

Vodafone, the world's second-largest mobile operator by revenue, gave up early gains to trade 0.3 percent lower after posting full-year earnings in line with forecasts and raising its dividend policy, but taking a hit on its key Indian business.

Germany's ZEW confidence index is due at 10: a.m.. Investors will look at U.S. housing data , due at 1:30 p.m., for clues on the strength of the recovery in the world's biggest economy.

U.S. stocks staged a comeback in late trading on Monday as bargain hunters snapped up beaten-down shares.