European shares reversed losses to trade higher on Tuesday after U.S. bellwether Caterpillar (CAT.N) reported strong quarterly results.

By 1143 GMT, the pan-European FTSEurofirst 300 .FTEU3 index of top shares was up 0.2 percent at 1,028.96 after earlier falling to as low as 1,018.98 points.

Food producers added the most points to the index. Nestle (NESN.VX), Danone (DANO.PA) and Cadbury (CBRY.L) were up 1 to 2.4 percent.

The banking sector reversed earlier falls to feature among the risers. Nordea (NDA.ST), Bank of Ireland (BKIR.I) and UBS (UBSN.VX) were up 0.6 to 9.5 percent.