* FTSEurofirst 300 rises 0.6 percent
* Financials gain; Barclays up on BGI sale talk
* Drugmakers, telecom shares retreat
* For up-to-the-minute market news, click on []
By Atul Prakash
LONDON, May 15 (Reuters) - European shares gained for a
second straight session on Friday, led higher by mining and
financial stocks, with Barclays <BARC.L> jumping on reports the
bank is in talks to sell its asset management arm.
At 0807 GMT, the FTSEurofirst 300 <> index of top
European shares was up 0.6 percent at 840.33 points, extending
the previous session's 0.5 percent gains.
Barclays rose more than 8 percent after a source familiar
with the matter told Reuters the British bank is in talks to
sell its asset management business, Barclays Global Investors.
The Financial Times reported that Barclays was discussing a
sale of the business for up to $10 billion to potential bidders
including U.S. money manager BlackRock.
Barclays and BlackRock declined to comment. []
Other banks also gained, with Standard Chartered Bank
<STAN.L> rising 1.6 percent, Lloyds <LLOY.L> advancing 2.9
percent, Royal Bank of Scotland <RBS.L> up 5.6 percent and
Commerzbank <CBKG.DE> rising more than 3 percent.
But defensive sectors such as pharma and telecoms retreated.
Shire <SHP.L> was down 1.3 percent, GlaxoSmithKline <GSK.L> fell
0.8 percent and AstraZeneca <AZN.L> slipped 0.9 percent.
Investors remained cautious despite recent strong gains in
European equities as macroeconomic indicators continued to
remind that the market was not out of the woods yet.
Data showed that German gross domestic product contracted by
a much larger than expected 3.8 percent in the first three
months of 2009, easily its worst performance since reunification
in 1990.
"Fear and greed (have) a huge part to play right now with
everyone desperate to call the bottom of the market but
absolutely terrified that these so called green shoots will
quickly turn into dead weeds," said Andrew Turnbull, senior
sales manager at ODL Securities.
"Whether we have the good fortune of a V-shaped recovery is
going to largely depend on the key indicators that we see both
here and over the pond during the next six months, rather than
the presence of a relief rally in our severely depressed equity
markets."
The FTSEurofirst 300 index, which slumped 45 percent in
2008, has gained about 30 percent from a lifetime low hit in
early March this year.
Chart analysts said the index was bouncing from the bottom
of its uptrend channel -- in place since early March of 2009 and
now standing at about 825 -- suggesting the rally was alive.
TELECOMS DOWN, MINERS GAIN
Telecommunications shares lost ground. BT Group <BT.L> fell
0.8 percent, France Telecom <FTE.PA> fell 1.8 percent and
Telecom Italia <TLIT.MI> was down 1.6 percent.
Belgium's dominant telecom operator, Belgacom <BCOM.BR>,
reported a 5 percent drop in core profit and repeated its
forecast for 2009. Its shares were, however, up 2.4 percent.
Miners advanced. BHP Billiton <BLT.L>, Anglo American
<AAL.L>, Antofagasta <ANTO.L>, Xstrata <STA.L> and Eurasian
Natural Resources <ENRC.L> were up 1-3.5 percent.
Rio Tinto <RIO.L> gained 2 percent after the miner said it
remains committed to a planned $19.5 billion tie-up with Chinese
metals firm Chinalco, responding to talk that the deal may be
revised to let more shareholders take part in a rights issue.
[]
Fashion retail giant Hennes & Mauritz <HMb.ST> reported a
slightly bigger than expected 8 percent year-on-year rise in
sales at established stores in April as spring purchases finally
took off. But its shares were down 1.2 percent.
Across Europe, the FTSE 100 index <> was up 0.2
percent, Germany's DAX <> fell 0.2 percent and France's
CAC 40 <> was 0.3 percent higher.
(Editing by David Cowell)
