European share rise 3 pct as banks rally

European shares jumped more than 3 percent in late trading on Wednesday as financial stocks surged on improved sentiment and energy shares tracked a rise in crude.

Optimism that the new U.S. administration was moving quickly to stabilise the ailing banking sector also helped the market, traders said.

By 1541 GMT, the FTSEurofirst 300 rose 3.2 percent to 810.30 points. Lloyds Banking Group surged 43 percent, Royal Bank of Scotland jumped 34 percent and Barclays gained 20 percent.

Energy shares also advanced, with Repsol up 1.4 percent, Total rising 2.4 percent and gas producer BG Group gaining 2.2 percent. Crude oil was 1 percent higher at nearly $42 a barrel.

Across the Atlantic, financial shares were stronger, driven by Wells Fargo which jumped 25 percent after maintaining its dividend and saying it did not need more taxpayer funds to absorb the troubled lender Wachovia Corp.