European shares hit a one-year high for a second straight session on Thursday, with strong earnings from companies including JPMorgan and a surge in U.S. stocks boosting market sentiment.
The FTSEurofirst 300 index of top European shares was up 0.3 percent at 1,019.42 points by 0836 GMT after rising to 1,021.63, the highest level in 12 months.
The index, which jumped 2.1 percent in the previous session, is up 23 percent this year and has surged 58 percent since hitting a record low in early March.
Banks, which have surged 177 percent since hitting a low in March, extended gains. Barclays, Royal Bank of Scotland, BNP Paribas, Societe Generale and Natixis rose between 0.1 percent and 1.1 percent.
Lloyds Banking Group was up 1 percent. British wealth manager Rathbone Brothers said it is in talks to buy assets, principally Lloyds' Bank of Scotland portfolio management service.
"Momentum is great," said Koen De Leus, economist at KBC Securities.
"The market at the moment is driven by liquidity. On the earnings side, every one thinks that financial results are going to be better than expected."
Investors awaited more earnings results later in the day from companies including Goldman Sachs, Citigroup, Google, International Business Machine and Nokia.
Sentiment also improved after the Dow Jones industrial average pierced the 10,000 level on Wednesday for the first time in a year on surprisingly robust company results and better-than-expected retail sales.
BEVERAGES, DRUGMAKERS ADVANCE
Beverage shares were in demand, with Diageo, Pernod Ricard, Carlsberg and Heineken rising between 0.4 percent and 2.2 percent. Anheuser-Busch InBev gained 0.5 percent. The world's largest brewer agreed to sell breweries in nine eastern European countries to CVC Capital Partners for an initial $2.23 billion, passing its target for divestments since its merger a year ago.
Drugmakers also advanced, with GlaxoSmithKline, Merck, Novartis, Novo Nordisk, Sanofi-Aventis and Shire rising 0.5 to 1.1 percent.
Insurers rose on positive market sentiment. Old Mutual, Prudential, Standard Life and Legal & General were 0.2 to 1.7 percent higher.
Miners came under pressure as key base metals prices fell. BHP Billiton, Antofagasta, Rio Tinto and Eurasian Natural Resources fell 0.2-0.8 percent.
In industry news, Mining group Xstrata gave up pursuit of rival Anglo American due to "value" issues after many Anglo shareholders rejected its merger of equals proposal and demanded a premium.
Xstrata was down 1 percent, while Anglo American fell 2.3 percent.
