Europe shares edge up after US giants report

* FTSEurofirst 300 up 0.4 pct after Thursday’s sharp drop

* BP gains 3.8 pct after leaking well capped

* Banking stocks gain after BofA results

* For up-to-the-minute market news, click on [STXNEWS/EU]

By Brian Gorman

LONDON, July 16 (BestGrowthStock) – European stocks moved higher at
midday on Friday after U.S. bellwethers General Electric Co
(GE.N: ) and Bank of America (BAC.N: ) reinforced a pattern of
strong second-quarter earnings.

At 1129 GMT, the FTSEurofirst 300 (.FTEU3: ) index of top
European shares was up 0.4 percent at 1,037.88 points, having
been in negative territory earlier in the session, and on track
to record a weekly gain of 1.6 percent.

GE reported a 16.1 percent rise in second-quarter profit (Read more your timing to make a profit.),
ending a steak of nine straight quarters of declines.
[ID:nN16144753]

“The good thing is the outcome is consistent with the other
results that we have seen this week,” said Mike Lenhoff, chief
strategist at Brewin Dolphin.

“The companies are reporting better-than-expected results,
which is very welcome news … If this is a sign of things to
come next week then I would have thought the concerns about a
double dip will diminish and this will be good for the markets.”

Bank of America (BAC.N: ), the largest U.S. bank by assets,
reported higher-than-expected second-quarter profit (Read more your timing to make a profit.) as credit
costs declined for the fourth straight quarter.

European banks were mostly higher, with some reversing
earlier losses. BNP Paribas (BNPP.PA: ), BBVA (BBVA.MC: ) and
UniCredit (CRDI.MI: ) rose between 1.3 and 1.7 percent.

But the results of stress tests in Europe, due next week,
were still worrying investors.

“We’re … waiting for the stress tests. Everyone assumes
banks are going to pass them, but there’s always a risk,” said
Andy Lynch, fund manager at Schroders.

Jean-Claude Juncker, the chairman of euro zone finance
ministers, said on Friday the stress tests on the European banks
should not reveal any “catastrophes” but the reviews should be
tough.

Oil major BP (BP.L: ) rose 3.8 percent after saying it has
capped its leaking well in the Gulf of Mexico. BP said late on
Thursday it had stopped the leak with a containment cap
installed three days earlier. [ID:nN15255571]

The stock is still down more than 36 percent from a peak in
mid-April, shortly before the scale and consequences of the leak
became known.

Around Europe, UK’s FTSE 100 index (.FTSE: ), Germany’s DAX
index (.GDAXI: ) and France’s CAC 40 (.FCHI: ) were up between 0.8
and 1.1 percent.

AIRLINES TAKE OFF

European airlines moved higher, led by British Airways
(BAY.L: ) and easyJet (EZJ.L: ), up 3 and 2.9 percent respectively
in London, after Goldman Sachs raised its estimates for the
sector in a bullish review, and upgraded its stance on easyJet.

Burberry (BRBY.L: ) shares rose 2.7 percent, and earlier hit a
record high, after the British luxury goods group said it would
buy the 50 stores in China currently operated by its franchise
partner for 70 million pounds ($107.5 million).

The FTSEurofirst 300, which lost 1.1 percent on Thursday, is
down about 7 percent since reaching a peak in April, when fears
over the euro zone debt crisis escalated.

“In the short term the market might go higher, as most
results may be better than expected, but as we go into Q3, my
fear is that the structural problems are still there, and we
have to worry about things like government balance sheets,”
Lynch of Schroders said.
(Editing by Hans Peters)

Europe shares edge up after US giants report