European shares flat; banks offsets weak drugmakers

                                
 * FTSEurofirst 300 index flat
                                
 * Banks rebound from earlier falls
                                
 * Philips shines after Q4 earnings
                                
 
                                
 By Joanne Frearson
                                
 LONDON, Jan 25 (Reuters) - European shares were flat at
midday on Monday, with banks gaining as fears over uncertainty
of U.S. President Barack Obama's bank plans waned, but defensive
drugmakers fell.
                                
 By 1235 GMT, the pan-European FTSEurofirst 300 <.FTEU3>
index of top shares had ticked up 0.04 point to 1,024.99 points.
                                
 The index is down around 1.8 percent this year, but is up
around 59 percent since reaching a lifetime low last March.
                                
 "We have seen investors come in this morning to pick
equities up from their lows on hopes that the last two weeks'
worth of losses were overdone," said Joshua Raymond, market
strategist at City Index.
                                
 "Today's gains have been all about bargain hunting with many
speculators seeing a few of the badly beaten stocks as looking
cheap."
                                
 Banks rebounded from earlier falls to add the most points to
the index as some traders fears over the impact of the White
House plans to restrict banks' risk taking subsided.
                                
 HSBC <HSBA.L>, Standard Chartered <STAN.L>, Societe Generale
<SOGN.PA>, Credit Suisse <CSGN.VX> and Barclays <BARC.L> rose
0.8 to 3.2 percent.
                                
 Greek banks <.FTATBNK> advanced 3.1 percent, boosted by high
demand for a syndicated five-year bond by the Greek government,
which is under pressure to fix its ballooning deficit.
                                
 Philips Electronics <PHG.AS> gained 5.4 percent after the
Dutch conglomerate reported a bigger-than-expected operating
profit.
                                
 
                                
 DRUGMAKERS, OILS SLIP
                                
 On the downside, drugmakers featured among the worst
performers. Novartis <NOVN.VX>, Roche <ROG.VX> and
GlaxoSmithKline <GSK.L> fell 0.8 to 1 percent.
                                
 Oil stocks were under pressure as crude <CLc1> prices
steadied below $75 a barrel, slipping towards a one-month low.
                                
 BP <BP.L>, Royal Dutch Shell <RDSa.L> and Total <TOTF.PA>
lost 0.3 to 0.5 percent.
                                
 Among other individual movers, the world's biggest mobile
networks maker Ericsson <ERICb.ST> slipped 1.4 percent after it
posted lower-than-expected sales for the fourth quarter.
                                
 Across Europe, the FTSE 100 <.FTSE> index was up 0.1
percent, Germany's DAX <.GDAXI> was down 0.3 percent and
France's CAC 40 <.FCHI> was up 0.1 percent.
                                
 "The general consensus is that this correction has been
overdue for a while and we're going to move sideways for quite a
while until we see clearer plans of how things are going to pan
out," said Philip Gillett, a trader at IG index.
 (Additional reporting Harpreet Bhal; Editing by Sharon
Lindores)