* FTSEurofirst 300 index up 0.6 percent
* Commodity shares track higher crude, metals prices
* Sanofi tumbles 9 percent on concerns over diabetes drug
* For up-to-the-minute market news, click on []
By Atul Prakash
LONDON, June 26 (Reuters) - European shares climbed in
morning trade on Friday after slipping in the previous session,
with a rise in crude and metals prices boosting commodity
stocks, while financial stocks recovered after recent losses.
At 0840 GMT, the FTSEurofirst 300 <> index of top
European shares was up 0.6 percent at 855.65 points after
falling 0.9 percent on Thursday. The index, which slumped 45
percent in 2008, has jumped 32 percent since hitting a lifetime
low in early March.
Energy stocks tracked crude oil prices <CLc1>, which rose
more than 1 percent to trade above $71 a barrel. BP <BP.L>,
Royal Dutch Shell <RDSb.L>, BG Group <BG.L>, Tullow Oil <TLW.L>,
Repsol <REP.MC>, Total <TOTF.PA> and StatoilHydro <STL.OL> added
0.5-3.3 percent.
"Most people will agree now that we won't revisit the low
point, that we have seen this year, again any time soon," said
Luc Van Hecka, chief economist at KBC Securities.
"But there are still some problems to be resolved in the
financial sector and as long as that is not out of the way in a
convincing manner, we could still have intermediate
corrections," he said.
UBS AG <UBSN.VX> fell 1 percent after the Swiss lender said
it planned to raise about 3.8 billion Swiss francs by selling
stock and expected to post a second-quarter net loss.
But the banking sector <.SX7P> was in a positive territory
after falling in 7 out of 11 previous sessions. HSBC <HSBA.L>,
Royal Bank of Scotland <RBS.L>, BNP Paribas <BNPP.PA>, Societe
Generale, Credit Suisse <CSGN.VX> and Deutsche Bank <DBKGn.DE>
gained 1.3-3.8 percent.
The Bank of England said British banks looked in better
shape than six months ago but were still vulnerable to economic
shocks. []
Miners got strength from higher metals prices. 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 0.4-2.9 percent.
Sanofi-Aventis <SASY.PA> shares tumbled 9 percent, extending
the previous day's sharp losses, while Novo Nordisk <NOVOb.CO>
lost 2.5 percent, on continuing concerns about the safety of
Sanofi's diabetes drug Lantus and modern insulins in general.
Morgan Stanley downgraded Sanofi to "equal-weight" from
"overweight" in the light of a debate among diabetologists over
the potential cancer risk of insulin analogues like Lantus,
while JPMorgan cut its rating on Sanofi to "neutral" from
"overweight".
Roche <ROG.VX> gained 0.5 percent as it filed its MabThera
cancer drug for approval in Europe as a first line biologic
treatment for rheumatoid arthritis.
Peugeot <PEUP.PA> fell 2.8 percent after Standard & Poor's
said it may cut its ratings on the carmaker into junk territory,
saying weak demand is likely to worsen the French company's
financial profile.
Across Europe, Britain's FTSE 100 index <>, Germany's
DAX <> and France's CAC 40 <> were up 0.4-0.8
percent.
(Editing by Dan Lalor)
