European shares gain, led by banks and miners

                                
 * FTSEurofirst 300 closes 1.1 pct higher
                                
 * Fiat surges 6.7 pct after Q2 results beat forecasts
                                
 * Banks gain after U.S. financials report
                                
 
                                
 By Brian Gorman
                                
 LONDON, July 21 (Reuters) - European shares made significant
gains for the first time in more than a week on Wednesday, with
banks rising after strong results from U.S. financials and on
optimism that stress tests will boost the sector's outlook.
                                
 The FTSEurofirst 300 <.FTEU3> index of top European shares
rose 1.1 percent to close at 1,017.88 points, though it had been
up more than 2 percent earlier. The index is still down more
than 8 percent from a mid-April peak on worries about debt
levels in Europe and the strength of economic recovery.  
                                
European banks to gain included BNP Paribas <BNPP.PA>,
Barclays <BARC.L>, Credit Suisse <CSGN.VX>, HSBC <HSBA.L> and
UBS <UBSN.VX>, up between 1.3 and 2.4 percent. 
                                
 U.S. bank Morgan Stanley <MS.N> reported higher than
expected second-quarter profit in spite of weak industry trends,
sending its shares up more than 9 percent. [ID:nN19193014]
                                
 "Good corporate earnings numbers from the banking sector
helped," said Bob Parker, vice chairman of asset management at
Credit Suisse. "And we bounced off good technical resistance
points, having fallen earlier in the week."
                                
 The stress tests, the results of which are due to be
released on Friday, will be rigorous and have credibility, said
Parker, adding: "Most will pass, and for those that don't there
will be a plan to deal with them."
                                
 The market's rally was fairly broad-based, though miners
were another strong performing sector. 
                                
 Copper rose to its highest in more than three weeks on
Wednesday due to strong physical buying and falling inventories.
                                
 Antofagasta <ANTO.L>, Fresnillo <FRES.L>, Kazakhmys <KAZ.L>,
Vedanta <VED.L> and Xstrata <XTA.L> rose between 3.1 and 7
percent. BHP Billiton <BLT.L> rose 2.5 percent after reporting a
16 percent jump in quarterly iron ore output, taking annual
production to a record,
                                
 Wall Street was lower around the time European bourses were
closing. The Dow Jones <.DJI>, S&P 500 <.SPX> and Nasdaq
Composite <.IXIC> were down between 0.2 and 0.7 percent.
                                
 As well as Morgan Stanley, Apple's <AAPL.O> results boosted
sentiment, but internet firm Yahoo <YHOO.O> helped to limit
gains, falling 8 percent after revenue trailed estimates.
                                
 The results were the latest in a batch of second-quarter
earnings that has also included some disappointments among
financials, such as Bank of America <BAC.N>.
                                
 Across Europe, Britain's FTSE 100 <.FTSE> ended the day up
1.5 percent; Germany's DAX <.GDAXI> and France's CAC 40 <.FCHI>
rose 0.4 and 0.8 percent, respectively.
                                
 
                                
 FIAT SURGES 
                                
 Among individual companies, Fiat <FIA.MI> surged 6.7 percent
after the Italian car maker's quarterly profit beat expectations
and it said it might raise its targets later this year.
                                
 Consumer brand company SSL International <SSL.L> rose 33.5
percent after consumer goods firm Reckitt Benckiser <RB.L>
agreed to buy the Durex condoms and Scholl sandals maker for 2.5
billion pounds ($3.8 billion). [ID:nLDE66K099]
                                
 BP rose 3.2 percent after announcing it would sell $7
billion of assets to Apache <APA.N>.
                                
 BP needs to raise funds following an oil spill in the Gulf
of Mexico, and its shares are still down more than 39 percent
from a mid-April peak, before the scale of the problem became
apparent. 
                                
 Drugs giant GlaxoSmithKline <GSK.L> ended the day 1.1
percent up after its results. [ID:nLDE66J1J0]
                                
 The Euro STOXX 50 <.STOXX50E>, the euro zone's blue-chip
index, rose 0.5 percent to 2,639.52 points, having earlier gone
through a key resistance level of 2,669.29, the index's 38.2
percent Fibonacci retracement of the April high to the May low.
                                
 In an effort to calm investors' jitters over the potential
impact of the euro zone debt crisis on Europe's banking system,
regulators are assessing how 91 banks across Europe would cope
with another economic downturn, and the results are due on
Friday after the closing bell.
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For a Take a Look on the stress tests: [ID:nLDE66K0YO]
For top 15 banks metrics comparison:
http://r.reuters.com/nyb97m
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  (Editing by Simon Jessop)