European shares rose on Tuesday, led by an upbeat outlook from Cairn Energy and an earnings boost from Legal & General, while Volkswagen fell after announcing a capital increase.
By 1229 GMT, the FTSEurofirst 300 index of top European shares was up 0.4 percent at 1,069.15 points. The benchmark is up around 66 percent from its March 9, 2009, low but has only gained 2.5 percent since the start of the year.
Cairn Energy surged 10.1 percent, as the oil explorer accompanied full-year results with upbeat comment on its operations in India and Greenland.
Within the oil and gas sector, BP, BG, Royal Dutch Shell and ENI rose 0.1 to 0.9 percent, but pared some gains as crude prices fell to around $81 a barrel.
British life insurer Legal & General rose 2.5 percent after it reported profits ahead of analysts' expectations, helped by cost cuts, and said it saw new opportunities this year in spite of subdued economic growth.
Peers ING, Swiss Life and Aegon advanced 0.4 to 2.2 percent.
"We have had some corporate news to digest and get excited about. Cairn Energy and Legal & General stand out as having some very healthy figures. That has combined with an almost insatiable appetite among investors to bid up stocks," said Tim Hughes, head of sales trading at IG Index.
Banks also gained, shaking off the previous session's losses. Barclays, HSBC, Societe Generale, BNP Paribas and Deutsche Bank added 0.5-2.1 percent while Greek banks climbed 2.4 percent.
"Broadly speaking, banks run the risks of suffering from a fallout if there is to be a big sovereign default but … banking stocks can ride a little bit of an independent track from the concerns about Greece," Hughes said.
On the downside, Raiffeisen International, emerging Europe's No.2 lender, dropped 2.9 percent as it failed to dispel investor doubts about how minority shareholders would benefit from its planned merger with parent RZB.
Across Europe, Britain's FTSE 100, Germany's DAX and France's CAC 40 rose 0.3-0.5 percent.
VW REVERSES
Volkswagen dipped 6.5 percent after it announced it would issue up to 65 million new preferred shares, with the capital hike designed to strengthen its financial stability and maintain its current credit rating.
Defence firm BAE System lost 1.8 percent, impacted by a recent contract disappointment and a downgrade in rating from Bernstein Research to "market perform" from "outperform".
Also in the sector, Babcock International made an agreed 1.33 billion pound offer for British rival VT Group, in a deal which will create a defence services giant. Babcock added 6.3 percent while VT Group firmed 5.7 percent.
Unibail Rodamco shed 1.8 percent. Societe Generale downgraded its recommendation on the firm to "sell" from "hold" as the broker cuts ratings on several other European real estate companies.
Shares in Europe's biggest betting firm, OPAP, however, rose 7 percent after it reported forecast-beating fourth-quarter profit.
On the macroeconomic front, British annual consumer price inflation slowed last month for the first time since September, slowing to 3.0 percent in February from January's 14-month high of 3.5 percent.
Later, investors will focus on key U.S. housing data, including February existing home sales, due at 1400 GMT.
