* FTSEurofirst 300 rises 0.9 pct
* Banks bouyed by strong results from Barclays
* Oil majors rally on higher crude prices
* For up-to-the-minute market news, click on []
By Harpreet Bhal
LONDON, Feb 16 (Reuters) - European shares rose in early
trade on Tuesday, buoyed by stronger banks after Barclays
<BARC.L> posted forecast-beating results, while oil majors drew
strength from rallying crude prices.
By 0912 GMT, the pan-European FTSEurofirst 300 <>
index was up 0.9 percent at 1,000.31 points, breaching the 1,000
mark for the first time in nearly two weeks as shares added to
gains from the previous session.
Barclays climbed 6.1 percent after beating expectations with
profits of over 11.6 billion pounds ($18.18 billion) last year,
on the back of a strong performance at its investment banking
unit.[].
Within the sector, Royal Bank of Scotland <RBS.L>, HSBC
<HSBA.L>, Societe Generale <SOGN.PA>, BNP Paribas <BNPP.PA>, UBS
<UBSN.VX> and Deutsche Bank <DBKGn.DE> added 1.8 to 4.4 percent.
With U.S. markets shut on Monday and several Asian exchanges
closed for the Lunar New Year holiday, direction is likely to be
dictated by economic data set for release on Tuesday including
UK inflation numbers and Germany's ZEW index figures.
"Whilst the banking sector initially will have some
enthusiasm, there will be a pall over the market as you see
weaker ZEW figures in Germany and inflation figures rising in
Britain," said Justin Urquhart Stewart, director at Seven
Investment Management.
British consumer price inflation is expected to have jumped
to a 15-month high of 3.5 percent in January, but the news is
unlikely to shift the Bank of England's view that this is a
transitory surge which will soon fade away. []
Also of interest will be the Mannheim-based ZEW economic
think tank index of German analysts and investor sentiment,
which is expected to show a reading of 42.0 after falling for
the fourth consecutive month in January, to 47.2.
Oil majors were higher, supported by a $1 rise in crude
prices to above $75 a barrel as the euro recovered from
nine-month lows and pressure stepped up for more sanctions on
Iran.
BP <BP.L>, BG <BG.L>, Royal Dutch Shell <RDSa.L>, Total
<TOTF.PA> and ENI <ENI.MI> added 0.7 to 1.1 percent.
Across Europe, Britain's FTSE 100 <>, Germany's DAX
<> and France's CAC 40 <> were up between 0.9 and 1.1
percent.
RISK APPETITE RISES
Investors' appetite for risky assets such as equities rose,
with the VDAX-NEW volatility index <.V1XI> falling 3 percent.
The lower the volatility index, which is based on sell and buy
options on Frankfurt's top-30 stocks <0#.GDAXI>, the higher the
market's desire to take on risk.
However, analysts said that persistent worries over Greece's
fiscal woes could prevent equities from pushing higher.
Euro zone states urged Greece on Monday to announce more
deficit-control steps by mid-March if needed, but said nothing
new of last week's pledge to defend the country.[]
"The key issue that is going to be hanging over Europe is
what is going to be happening with Greece ... because there is
still no resolution. The market desperately wants to have a
clear line," Urquhart-Stewart said
Among individual movers, Vallourec <VLLP.PA> rose 3.8
percent after the seamless tube maker said on Monday it would
build a new factory in the United States, investing $650 million
in the project to meet the needs of the North American oil and
gas market. []
L'Oreal <OREP.PA> fell 4.3 percent after the French
cosmetics group reported fourth-quarter sales below forecasts,
and pledged to improve turnover and earnings in 2010.
Defensive tobacco stocks were also weaker, falling out of
favour as appetite for riskier assets intensified and as a
broker downgrade weighed on Imperial Tobacco <IMT.L>
The firm shed 1.1 percent, pressured by a ratings downgrade
by Nomura to "neutral" from "buy". British American Tobacco
<BATS.L> and Swedish Match <SWMA.ST> were off 0.2 and 0.6
percent respectively.
(Reporting by Harpreet Bhal, Editing by Hans Peters)
