Europe shares inch up; miners track firmer metals

                                
 * FTSEurofirst 300 index up 0.1 pct
                                
 * Miners gain tracking stronger metals prices
                                
 * Banks up, pharma shares down
                                
 * For up-to-the-minute market news, click on [STXNEWS/EU]
                                
 
                                
 By Atul Prakash
                                
 LONDON, May 22 (Reuters) - European shares edged higher in
early trade on Friday after falling more than 2 percent in the
previous session, as financials rose and miners extended gains
on stronger metal prices.
                                
 At 0901 GMT, the FTSEurofirst 300 <.FTEU3> index of top
European shares was up 0.1 percent at 857.85 points after
falling as low as 851.37. The index, which slumped 45 percent in
2008, is up 32 percent so far from its March 9 lifetime low.
                                
 Miners derived strength from higher metals prices, with
copper up 2 percent, nickel rising 3 percent and zinc gaining
2.9 percent. BHP Billiton <BLT.L>, Anglo American <AAL.L>,
Antofagasta <ANTO.L>, Rio Tinto <RIO.L>, Xstrata <STA.L> and
Eurasian Natural Resources <ENRC.L> rose 1.6-4.7 percent.
                                
 Banks were also higher. Standard Chartered Bank <STAN.L>,
Barclays <BARC.L>, Lloyds <LLOY.L>, Royal Bank of Scotland
<RBS.L>, Societe Generale <SOGN.PA> and Commerzbank <CBKG.DE>
were up 0.7-3.5 percent.
                                
 But British Airways <BAY.L> fell 5 percent after slumping to
a record loss and nearly doubling its debt pile during the year
to end March, and saying the tough conditions made it impossible
to give any guidance for the current period. [ID:nLM183816]
                                
 Pharma stocks, too, came under pressure. AstraZeneca
<AZN.L>, Novo Nordisk <NOVOb.CO>, Roche <ROG.VX> and Shire
<SHP.L> were down 0.1-1.6 percent.
                                
 British-based drug company GlaxoSmithKline <GSK.L> was down
1 percent. It is battling the U.S. Internal Revenue Service over
a potential $1.9 billion in back taxes, interest and penalties,
the Wall Street Journal said.
                                
 "Fridays are always a good barometer of sentiment - it will
be interesting to note if there is a deluge of funds piling back
into the market, especially ahead of the long weekend in the
UK," said Chris Hossain, senior sales manager at ODL Securities,
referring to a UK holiday on Monday.
                                
 
                                
 ECONOMIC CONCERNS
                                
 He said that economic concerns had been resurfacing after
markets posted impressive gains in the past two months.
                                
 "Chilling words from S&P have reinstalled the fear factor
amongst investors, who are now facing yet another pivotal
period," he added.
                                
 In Britain, prospects were clouded by a warning over
government debt and political uncertainty as Standard & Poor's
on Thursday lowered its outlook to "negative" and said it might
cut the country's precious triple-A credit rating.
[ID:nLL627240]
                                
 Data from the United States on jobless claims and business
conditions in the previous session dented hopes of a quick
economic rebound.
                                
 Across Europe, the FTSE 100 index <.FTSE>, Germany's DAX
<.GDAXI> and France's CAC 40 <.FCHI> were up 0.5-0.7 percent.
                                
 Energy stocks were mixed. BP <BP.L>, Tullow Oil <TLW.L>,
Total <TOTF.PA> and StatoilHydro <STL.OL> shed 0.2-2.1 percent,
while Royal Dutch Shell <RDSb.L>, BG Group <BG.L> and Repsol
<REP.MC> rose 0.1-1.3 percent.
                                
 Global miner BHP Billiton <BLT.L> rose 2.9 percent after the
company said it was looking to develop a big uranium mine in
western Australia. [ID:nSYD471578]
 (Editing by Jon Loades-Carter)