* FTSEurofirst 300 up 0.8 pct
* 85 bln euro bailout for Ireland boosts confidence
* Heavyweight banking shares among top risers
By Harpreet Bhal
LONDON, Nov 29 (Reuters) - European shares rose on Monday,
after an 85 billion euro bailout for Ireland helped reassure
investors over the country's debt situation, though fears over
possible contagion to other euro zone states remained.
By 0927 GMT, the pan-European FTSEurofirst 300 <>
index of top shares was up 0.8 percent at 1,095.39 points,
having earlier hit a one-week intraday high at 1,096.38 points.
The index shed 1.5 percent last week, partly on persistent
worries over the possibility of contagion of the debt troubles
in the euro zone.
EU finance ministers on Sunday endorsed the 85 billion euro
($112.6 billion) bailout package for Dublin, including 10
billion euros to recapitalise Irish banks in the coming months
and 25 billion more for them if needed. []
Banks were among the main risers, with the National Bank of
Greece <NBGr.AT> up 4.1 percent, Allied Irish Banks <ALBK.I>
rising 7.3 percent and Royal Bank of Scotland <RBS.L> up 2.7
percent.
The spotlight now turns to the finances of Portugal and
Spain, which investors worry could be the next casualties in the
euro zone debt crisis, as the euro fell to a two-month low.
"What is required is... an increase in the size of the
European Financial Stability Fund. Investors are worried that
what is left in the EFSF isn't big enough if Spain had a
problem," said Bernard McAlinden, investment strategist at NCB
Stockbrokers in Dublin.
The EU also outlined a permanent system to resolve the euro
zone debt crisis in which private bondholders could be made to
share the burden of restructuring a euro zone's sovereign debt
bought after 2013, subject to a case-by-case evaluation.
"The idea of a rescue package in principle is very positive
but the idea that you could be taking hits on bonds is negative.
At the very least you will be exposed to a potential loss if you
fund a country that runs into trouble," McAlinden said.
Across Europe, Britain's FTSE 100 <>, Germany's DAX
<> and France's CAC 40 <> rose 0.4 to 0.8 percent,
while the Thomson Reuters Peripheral Eurozone Countries Index
<.TRXFLDPIPU> added 1.1 percent.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
TAKE A LOOK- Europe's debt problems []
Euro zone debt struggle http://link.reuters.com/dah65q
Euro zone debt graphic http://r.reuters.com/hyb65p
Interactive timeline http://link.reuters.com/nyx95q
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
RECOVERY SEEN
On the macroeconomic front, the Conference Board leading
economic index (LEI) for the euro zone -- which indicates
economic development up to six months ahead -- rose 0.4 percent
to 114.0 in October, pointing to continued economic recovery.
[]
"Ongoing concerns about the impact of the unfolding
financial crisis on Europe's already modest growth potential
should not be overstated," said Jean-Claude Manini, the Board's
senior economist for Europe.
Among individual movers, Austria's Raiffeisen Bank
International <RBIV.VI> rose 3.1 percent after it confirmed its
full-year outlook []
Oil majors were also on the rise, as crude prices <CLc1>
climbed to a two-week high above $85 as the dollar weakened
across the board following the Irish bailout announcement.
BP <BP.L> added 1.4 percent after the oil major agreed to
sell its stake in Argentina-based Pan American Energy to Bridas
Corp, half owned by China's CNOOC <0883.HK> as it raises cash to
pay for the Gulf of Mexico oil spill. []
Within the sector, Royal Dutch Shell <RDSa.L> and Total
<TOTF.PA> both added around 1.2 percent.
($1=.7551 Euro)
(Editing by Jon Loades-Carter)
