* FTSEurofirst 300 index rises 0.7 pct
* BP off lows, but still down 43.4 pct since oil spill
* Home Retail falls, first-quarter sales disappoint
* For up-to-the minute market news, click on []
By Joanne Frearson
LONDON, June 10 (Reuters) - European shares rose on Thursday
ahead of several key central bank interest rate decisions, with
banks gaining on a more positive global recovery sentiment and
oil spill-hit BP <BP.L> moving off its lows.
By 0916 GMT, the FTSEurofirst 300 <> index of top
shares was up 0.7 percent at 1,005.78 points after earlier being
as low as 989.22. The index is down around 9.6 percent from a
mid-April peak on concerns about the euro zone debt crisis.
Interest rate decisions are due by the European Central Bank
at 1145 GMT and the Bank of England at 1100 GMT.
In London, BP stock was down 5.4 percent off session lows,
althoguh this is still down 43.4 percent since the massive oil
spill in the Gulf of Mexico began in April, wiping about 53.5
billion pounds ($78 billion) off its market capitalisation.
"The reversal from BP off its lows is helping," said Giles
Watts, head of equities at City Index. "We have seen quite a lot
of people coming into buy it."
The oil giant said it had the financial flexibility to deal
with liabilities related to the spill, and that it was unaware
of any justification for the collapse in its share price.
The company is under pressure from U.S. officials to forego
their dividend because of the likely costs associated with the
spill.
"BP is such a big player and is really causing jitters
across Europe," said Will Hedden, sales trader at IG Index. "If
it has to go ahead and cut its dividend, it is really going to
be seen as a bad thing."
Meanwhile, ARM Holdings <ARM.L> soared 10.6 percent after
traders cited talk of a bid from Apple <AAPL.O>, although a
spokeswoman for ARM said it had not received an approach and a
takeover from Apple would not make sense.
Banks reversed earlier sessions gains to feature among the
top performers. Banco Santander <SAN.MC>, BBVA <BBVA.MC> and
Barclays <BARC.L> all rose 1.7 to 2.5 percent.
Deutsche Bank <DBKGn.DE> fell 0.9 percent after a report in
Germany's financial daily Handelsblatt said that a U.S. unit of
the bank, Taunus Corp, may need fresh capital and has drawn
attention from U.S. regulators.
HOME RETAIL FALLS
Home Retail <HOME.L>, Britain's No.1 household goods
retailer, fell 4.1 percent after it posted a bigger than
expected drop in first-quarter sales. []
Nokia <NOK1V.HE> slipped 0.5 percent pressured over
continued fears over a possible profit warning following rumours
on Wednesday. The company declined to comment.
On the upside, Swiss drugmaker Novartis <NOVN.VX> gained 2.1
percent ahead of a U.S. advisory panel meeting later in the day,
which will vote on whether to recommend Gilenia as the first
pill to treat multiple sclerosis.
Meanwhile, the ECB interest rate is expected to keep rates
unchanged and could offer extra funds to banks to ease the
strain caused by the euro zone's debt crisis. []
At the latest BoE rate decision, the first to be made after
the formation of the new British coalition government the BoE is
seen holding rates steady. []
Across Europe, the FTSE 100 <> index was up 0.2
percent, Germany's DAX <> was 0.5 percent higher and
France's CAC 40 <> gained 0.8 percent.
Spain's IBEX 35 <> was up 1.6 percent, Portugal's PSI
20 <> rose 0.6 percent and Italy's benchmark <.FTMIB>
gained 1 percent.
(Reporting by Joanne Frearson; editing by Simon Jessop)
