* FTSEurofirst 300 rises 0.4 pct
* BP rises on action to stop oil leak
* Airlines suffer from volcanic ash
* For up-to-the-minute market news, click on []
By Brian Gorman
LONDON, May 17 (Reuters) - European shares rose on Monday
morning with BP <BP.L> gaining on action to stop an oil leak,
though worries persisted about the euro zone sovereign debt
crisis, and the euro <EUR=> fell to a 4-year low.
At 0859 GMT, the FTSEurofirst 300 <> index of top
European shares was up 0.4 percent at 1,018.42 points, after a
sharp fall of 3.4 percent on Friday on euro zone sovereign debt
worries. The index is down 8.7 pct from a 19-month peak it
reached on April 15.
Index heavyweight BP rose 2.9 percent after reporting a
limited success at containing the oil that is gushing unabated
into the Gulf of Mexico on Sunday, but a sceptical U.S.
government said it was "not a solution."
Banks, among the biggest losers in the recent turmoil, were
mostly higher. Italy's Banco Popolare <BAPO.MI> rose 6.7
percent, after first-quarter profit beat forecasts.
Standard Charetered <STAN.L> and HSBC <HSBA.L> rose 4 and
1.7 percent respectively after JPMorgan reiterated its
"overweight" stance on both.
But Bank of Ireland <BKIR.I> fell 4 percent after it set the
discount for its rights issue at the higher end of the indicated
range.
German Chancellor Angela Merkel said on Sunday that a $1
trillion EU rescue plan had only bought the euro zone time to
tackle its fundamental problem -- a yawning gap between its
strongest and weakest economies. []
"The overhang from last week is going to continue, though
I'm looking for a little more stabilisation, and calm, as
finally the euro zone starts to focus on the one issue they must
address, which is not handing out monetary bribes, but actually
making sure they do some financial restructuring," said Justin
Urquhart Stewart, director at Seven Investment Management.
The euro slid to a four-year low on Monday on sovereign debt
worries and fears that planned belt-tightening measures will
hurt euro zone growth, fuelling concerns the single currency may
face free-fall.
"How do you stop speculators betting against your currency?
The answer is you get your economy working properly," Urquhart
Stewart said.
Airlines suffered as volcanic ash from Iceland caused
widespread disruption at airports in Britain and other parts of
northern Europe, delaying or grounding hundreds of flights.
[]
Air France-KLM <AIRF.PA> and Ryanair <RYA.I> fell 3.8 and
3.5 percent respectively.
EasyJet <EZJ.L> fell 5.9 percent after founder Stelios
Haji-Ioannou stepped down from the board of the budget airline
in order to lead a shareholder revolt against plans to increase
the size of its fleet.
Across Europe, Britain's FTSE 100 <> and Germany's DAX
<> were up 0.7 and 0.4 percent respectively; France's
CAC40 <>was flat.
MAN FALLS ON GLG DEAL
Among other individual companies, hedge fund firm Man Group
<EMG.L> fell 3.9 percent after agreeing a deal to buy rival GLG
Partners, creating a new giant in an industry reshaping after
the financial crisis. []
Britain's Prudential <PRU.L> fell 2.7 percent after
launching its $21 billion rights issue, finally allowing the
insurer to push ahead with its acquisition of AIG's <AIG.N>
Asian insurance business. []
Vodafone <VOD.L> rose 1.7 percent, ahead of full-year
results on Tuesday.
Data due later in the week includes U.S. housing starts and
permits on Tuesday.
(Editing by Hans Peters)
