* FTSEurofirst 300 up 0.5 pct to near 1-year closing high
* Oils rise as crude tops $80
* Tesco up after Nomura raises target price
* Deutsche Bank shares fall after Q3 results
By Brian Gorman
LONDON, Oct 21 (Reuters) - European shares closed higher on
Wednesday, with oils gaining as crude <CLc1> rose to more than
$80 a barrel, and as U.S. companies continued to beat forecasts
for third-quarter earnings.
The FTSEurofirst 300 <> index of top European shares
rose 0.5 percent to close at 1,025.88 points, recouping almost
all the loss from the previous session, and taking it to near
its highest close since Oct. 3, 2008.
The index is up nearly 59 percent from its lifetime low on
March 9, as investors have become more confident on the
prospects of economic recovery.
"The general theme continues to be that the significant
improvement we have seen in economic indicators also shows up in
Q3 earnings," said Tammo Greetfeld, equity strategist at
UniCredit Group. "All the fundamental factors in the equity
market are still intact, and the upward strength will continue,
though a breather is overdue."
Crude oil prices rose above $80 a barrel to one-year highs
after U.S. government data showed inventories rose less than
expected. The oil price was also supported by the dollar
weakening to trade at more than $1.50 against the euro <EUR=>.
ENI <ENI.MI>, BP <BP.L>, Royal Dutch Shell <RDSa.AS> and
Repsol <REP.MC> rose 0.7-1.2 percent.
U.S. financial services firm Morgan Stanley <MS.N> reported
better-than expected quarterly profit on strong fixed-income
sales and trading revenue and improved investment banking
underwriting results, sending its shares up 6.9 percent.
[]
Internet company Yahoo <YHOO.O> also rose, up 3.9 percent,
after its earnings pleased the market.
As European bourses were closing, the Dow Jones <>, S&P
500 <.SPX> and Nasdaq Composite <> were up 0.4-0.7 percent.
Across Europe, Britain's FTSE 100 <> and Germany's DAX
<> closed 0.3 and 0.4 percent higher respectively;
France's CAC-40 <> rose 0.05 percent.
BANKS REVERSE LOSSES
Banks, which had been lower for much of the day, were mostly
up by the close. Natixis <CNAT.PA> surged 11.4 percent after
Credit Suisse upped its price target to 5.7 euros, from 4.2, on
the loss-making French investment bank, keeping an 'outperform'
rating. []
Index heavyweights Banco Santander <SAN.MC> and HSBC
<HSBA.L> ended the day up 1.8 percent and 1.3 percent
respectively.
But Deutsche Bank <DBKGn.DE> dropped 2.4 percent after
Germany's biggest bank said tax credits had flattered net profit
in the third quarter. []
Among other individual shares, British supermarket operator
Tesco <TSCO.L> rose 2.3 percent after Nomura raised its target
price to 526 pence, from 405 pence.
Tesco's British margin is likely to step change to 7.2
percent from 6.2 percent, said Nomura, as it pointed to the
potential for the company's banking, telecoms and online
businesses. French peer Carrefour <CARR.PA> rose 1.6 percent.
French carmaker Peugeot <PEUP.PA> fell 4.8 percent after it
said third-quarter revenue slowed less sharply than in previous
quarters, but analysts at Morgan Stanley analysts said sales
were still disappointing. []
Fiat <FIA.MI> also dropped, down 2.0 percent after the
company reported a better-than-expected third-quarter trading
profit but said it might write off past investments.
[]
Spain's Grupo Ferrovial <FER.MC> fell 2.3 percent after
agreeing to sell London's Gatwick Airport for 1.51 billion
pounds ($2.46 billion) to a consortium involving Credit Suisse
<CSGN.VX> and General Electric <GE.N>. []
Collins Stewart cut its target price for Ferrovial by 8
percent, and maintained its 'sell' rating.
Chipmaker STMicroelectronics <STM.PA> fell 4.6 percent after
posting its seventh consecutive quarterly loss. []
(Additional reporting by Christoph Steitz; Editing by Dan
Lalor)
