* FTSEurofirst 300 rises 1.4 pct after Wednesday's dip
* Energy, mining shares track stronger commodity prices
* Banks advance; traders say UBS stake sale oversubscribed
* For up-to-the-minute market news, click on []
By Atul Prakash
LONDON, Aug 20 (Reuters) - European shares raced higher in
early trade on Thursday, supported by a rebound in Asian
equities, with commodity stocks tracking stronger crude and
metals prices and banks up after the previous day's decline.
At 0819 GMT, the FTSEurofirst 300 <> index of top
European shares was up 1.4 percent at 945.05 points after
falling 0.3 percent in the previous session.
The index, which slumped 45 percent in 2008, is up 13
percent this year and has jumped 46 percent since falling to a
record low in early March.
Sentiment improved after Chinese stocks <> surged 4.5
percent, posting their second-biggest daily percentage gain of
the year, as modest signs of official support for the market
helped to trigger technical buying after a 20 percent dive in
the two weeks up to Wednesday's close.
Financial stocks topped the gainers list, with Barclays
<BARC.L>, Lloyds <LLOY.L>, Royal Bank of Scotland <RBS.L>, BNP
Paribas <BNPP.PA>, Societe Generale <SOGN.PA>, Credit Suisse
<CSGN.VX> and Swedbank <SWEDa.ST> rising 0.7-3.2 percent.
UBS <UBSN.VX> rose 1.3 percent after dealers said the sale
of a 9 percent government stake in the Swiss bank was several
times oversubscribed, with a source saying the deal priced at
16.50 Swiss francs per share.
"Markets are often dictated by state of mind, and one can't
help but sense the growing feeling of optimism," said Brian
Myers, analyst at ODL Securities.
"Whilst economic data suggests that we are not out of the
woods just yet, we are certainly walking with a bit more of a
spring in our steps."
Energy shares tracked the price of crude oil <CLc1>, which
was steady above $72 a barrel after rising more than 4 percent
in the previous session. BP <BP.L>, Royal Dutch Shell <RDSa.L>,
BG Group <BG.L>, Tullow Oil <TLW.L>, Repsol <REP.MC>, Total
<TOTF.PA> and StatoilHydro <STL.OL> added 1.1-2.3 percent.
Miners got strength from higher metals prices. BHP Billiton
<BLT.L>, Anglo American <AAL.L>, Antofagasta <ANTO.L>, Xstrata
<XTA.L> and ENRC <ENRC.L> were up 1.4-2.9 percent.
Rio Tinto <RIO.L>, the world's second-largest miner, was up
1.7 percent. It posted a record drop in first-half profit, in
line with market forecasts, and said it was confident about the
future after a tough 18 months. []
"We are seeing demand for Rio shares in early trading, and
with many of the major mining results now coming in as expected,
we anticipate further upside for the sector and Rio shares,"
said Richard Curr, analyst a Prime CFDs Ltd.
Ahold <AHLN.AS> advanced 4.4 percent after the Dutch
supermarket group reported second-quarter operating profit above
forecasts, helped by cost controls even as the retail
environment continues to reflect weak economic conditions.
[]
Across Europe, Britain's FTSE 100 index <>, Germany's
DAX <> and France's CAC 40 <> were 1-1.4 percent
higher.
(Editing by Will Waterman)
