European shares rose on Tuesday at midday, led by the banking sector as Barclays (BARC.L) posted stronger than expected results, while commodity stocks tracked metal and crude CLc1 prices higher as the dollar weakened.
By 1138 GMT, the pan-European FTSEurofirst 300 .FTEU3 index of top shares was up 0.5 percent at 996.52 points. The index is down 4.7 percent this year after gaining around 26 percent in 2009.
Equities are being supported by the banking sector in the wake of Barclays, said Jeremy Batstone-Carr, head of research at Charles Stanley.
But, I do not believe Greece is out of the woods ... despite Europe being in positive territory it is a major problem that has not gone away.
Banks added the most points to the index. Barclays (BARC.L) soared 6.4 percent after it said it had started the year well after beating expectations, with 2009 profits of over 11.6 billion pounds ($18.18 billion).
HSBC (HSBA.L), Lloyds Banking Group (LLOY.L) Deutsche Bank (DBKGn.DE) and Credit Suisse (CSGN.VX) rose 1.8 to 5 percent. Energy stocks were in demand as crude CLc1 gained 1 percent. Cairn Energy (CNE.L), BP (BP.L), Royal Dutch Shell (RDSa.L) and Total (TOTF.PA) were up 0.5 to 1.4 percent.
MINERS IN DEMAND
Miners were in favour as copper MCU3=LX rose 1.6 percent. Anglo American (AAL.L), Antofagasta (ANTO.L), BHP Billiton (BLT.L) and Xstrata (XTA.L) were 1.7 to 2.7 percent higher.
On the downside, French company L'Oreal (OREP.PA) fell 5.5 percent after it announced fourth-quarter sales below forecasts late on Monday.
Givaudan (GIVN.VX) slipped 4.8 percent after it posted a full-year net profit of 199 million Swiss francs ($185.3 million), while analysts in a Reuters poll had expected 205 million francs.
Analysts said that persistent worries over Greece's fiscal woes could prevent equities from pushing higher.
Sweden's finance minister said Greece's deficit-reduction plan was not enough, raising pressure on Athens to do more to prevent a swollen debt and broader financial market trouble from getting out of hand.
On Monday, euro zone states urged Greece to announce more deficit-control steps by mid-March if needed.
In economic news, German analyst and investor sentiment fell less sharply than expected in February, a closely watched survey showed, suggesting Europe's largest economy may be more resilient than feared. [ID:nLDE61F0XL]
Across Europe, the FTSE 100 .FTSE index was up 0.9 percent, Germany's DAX .GDAXI rose 0.8 percent and France's CAC 40 .FCHI gained 0.6 percent.