Europe shares rise for 6th day; banks, miners gain

                                
 * FTSEurofirst 300 up 0.5 pct; hits 11-month high
                                
 * Financial shares extend recent gains; top gainers
                                
 * Miners advance on recovery hopes
                                
 * For up-to-the-minute market news, click on [STXNEWS/EU]
                                
 By Atul Prakash
                                
 LONDON, Sept 11 (Reuters) - European equities advanced for a
sixth straight session to hit a fresh 11-month high on Friday,
with financial shares extending recent gains and miners rising
on global economic recovery hopes.
                                
 At 0819 GMT, the FTSEurofirst 300 <.FTEU3> index of top
European shares was up 0.5 percent at 992.81 points after
touching 995.37, the highest level since October last year. The
index is up 20 percent this year and has jumped 54 percent since
hitting a record low in early March.
                                
 But it is still down about 15 percent from its level just
before the collapse of Wall Street firm Lehman Brothers a year
ago that accelerated the global credit crisis.
                                
 Banks were among top gainers, with Barclays <BARC.L>, Lloyds
<LLOY.L>, Royal Bank of Scotland <RBS.L>, BNP Paribas <BNPP.PA>,
Societe Generale <SOGN.PA> and Commerzbank <CBKG.DE> rising
0.2-3.3 percent.
                                
 "The ride down was hard, and the rally has been equally
spectacular, but I'm sure many traders would prefer smoother
movements over the whipsawing effect we have seen over the past
12 months," said John Murphy, analyst at ODL Securities.
                                
 "Mixed overnight trading in Asia makes for an interesting
final trading session of the week. As we approach year highs,
and the anniversary of the Lehman Brothers crash, it will be
interesting to note if there is a period of reflection next
week," he added.
                                
 Improving macro-economic picture across the world boosted
sentiment. Chinese industrial output, investment and credit
growth accelerated in August, suggesting the economic recovery
was on a solid course, but Beijing was unlikely to hit the
policy brakes too hard to avoid derailing it. [ID:nPEK13979]
                                
 The dollar hit one-year lows after stronger-than-expected
Chinese data, prompting investors to sell the low-yielding U.S.
dollar for other riskier assets.
                                
 The VDAX-NEW volatility index <.V1XI>, was down 0.9 percent,
hitting its lowest level in nearly one month. The lower the
volatility index, which is based on sell and buy options on
Frankfurt's top-30 stocks <0#.GDAXI>, the higher is investors'
appetite for risky assets, such as cyclical stocks.
                                
 
                                
 ECONOMIC RECOVERY
                                
 U.S. Treasury Secretary Timothy Geithner said on Thursday a
strengthening economy means the government can end some of the
extraordinary support it put in place for markets and prepare
for a slow recovery. [ID:nN10401052]
                                
 Appearing before the Congressional Oversight Panel for the
$700 billion Troubled Asset Relief Program, Geithner said the
economy was in far better shape now than a year ago when it was
"on the verge of collapse," though it still had problems.
                                
 Mining shares were in demand as signs of a global economic
recovery improved the sector's outlook. BHP Billiton <BLT.L>,
Anglo American <AAL.L>, Antofagasta <ANTO.L>, Rio Tinto <RIO.L>
and Xstrata <XTA.L> rose 0.5-2.2 percent.
                                
 "There is no reason for markets to stop just because we are
approaching fair values. On the way down, European markets
significantly undershot fair value, so why not overshoot,
especially as a number of positive catalysts are feeding off
each other," J.P. Morgan said in a note.
                                
 In industry news, Canadian automotive supplier Magna
International <MGa.TO> promised to ringfence its Opel operations
once it takes control of the former General Motors [GM.UL]
carmaking unit. [ID:nLB518046]
                                
 GM's board has agreed to sell Magna and its Russian partner
Sberbank <SBER03.MM> a 55 percent stake in Opel in a deal that
is supposed to close by the end of November. [ID:nLA668553]
                                
 Some Magna customers including Volkswagen <VOWG.DE> have
expressed concern about the potential conflict of interest the
deal poses as Magna continues to supply Opel rivals.
                                
 British insurer Prudential <PRU.L> will look to Asia as a
source of capital and could even seek to raise equity there,
Chief Executive-Elect Tidjane Thiam said in a Financial Times
report on Friday [ID:nLA433371]. Its shares were up 1 percent.
                                
 Across Europe, UK's FTSE 100 index <.FTSE>, Germany's DAX
index <.GDAXI> and France's CAC 40 <.FCHI> rose 0.3-0.6 percent.
 (Editing by Hans Peters)