* FTSEurofirst 300 index closes up 0.7 percent
* Banks boosted by forecast beating JPMorgan results
* HeidelbergCement rises as traders cite broker note
By Joanne Frearson
LONDON, April 13 (Reuters) - European shares rose on
Wednesday, with banking stocks boosted by forecast-beating
results from Wall Street bank JPMorgan <JPM.N> and strategists
suggested there was further upside for the sector.
The pan-European FTSEurofirst 300 <> index of top
shares closed up 0.7 percent at 1,135.24 points after a sell-off
in the previous session when a bout of profit taking was sparked
by Japan's worsening nuclear crisis.
Volume was 94 percent of its 90-day average.
"It is right to focus on financials as within Europe that
has been the thing that has held the region back," Gary Baker,
head of European Equity strategy at BofA Merrill Lynch said.
"We have turned a corner a little bit in banks and are
closer to progress in the banking sector than we have been for
the last couple of years. I do think financials offer decent
upside."
U.S. bank JPMorgan <JPM.N>, the first major Wall Street bank
to report quarterly results, beat expectations with a 67 percent
rise in profit. []
The STOXX Europe 600 Banks index <.SX7P> gained 0.6 percent,
the second best performing sector in Europe this year,
recovering from the previous session losses. Deutsche Bank
<DBKGn.DE>, Barclays <BARC.L> and HSBC <HSBA.L> rose 1 to 1.6
percent.
According to Thomson Reuters StarMine data, 12-month forward
earnings growth for banks was at 23.3 percent, compared to the
STOXX Europe 600 index <> at 12.8 percent.
More generally, strategists said there was further upward
momentum for European stocks and that valuations were
attractive.
Valuations on the STOXX Europe 600 index <> showed the
one-year forward price-to-earnings stood at about 10.8 against a
10-year average of 13.5, according to Thomson Reuters
Datastream.
"We've had lots of hiccups along the way, but we're still at
mid-cycle. Valuations are still very supportive," said Karen
Olney, head of thematic strategy at UBS.
Across Europe, the FTSE 100 <> index was up 0.8
percent, Germany's DAX <> gained 1.1 percent and France's
CAC 40 <> was 0.8 percent higher.
CONSTRUCTION STOCKS GAIN
Elsewhere, construction stocks were in demand. Germany's
HeidelbergCement <HEIG.DE> rose 4 percent and Swiss cement maker
Holcim <HOLN.VX> gained 4.4 percent, after broker Exane BNP
Paribas upgraded the sector.
Positive broker notes also helped lift technology stocks.
Alcatel-Lucent <ALUA.PA> rose 7.5 percent after traders said
Morgan Stanley raised its recommendation to "overweight" from
"equal-weight".
ARM Holdings <ARM.L> gained 6.8 percent after traders
pointed to a Morgan Stanley note, which cited upbeat comments
from Microsoft about an Internet Explorer 10 version which ran
on an ARM-designed processor.
Buyers also targeted Reckitt Benckiser <RB.L> up 4.2 percent
after Bernstein upgraded its rating to "outperform" from
"market-perform" and JPMorgan raised its earnings estimates.
(Additional reporting by Brian Gorman. Editing by Jane
Merriman)
