European equities were little changed by midday on Monday as a sharp rise in Greek banks following an EU-IMF rescue package for the debt-plagued country was offset by weaker pharmaceutical and commodity stocks.
At 1107 GMT, the FTSEurofirst 300 index of top European shares was almost flat at 1,101.84 points after rising to 1,105.08 — its highest in more than 18 months. The index closed 1.3 percent higher on Friday, notching up its sixth straight week of gains.
The European benchmark is up 5 percent this year and has jumped more than 70 percent from its record low in March 2009.
Banks were among the top gainers, with the STOXX Europe 600 banking index rising 1 percent and the Greek banking index surging 7.6 percent. National Bank, EFG Eurobank, Piraeus Bank and Alpha Bank gained between 8.3 and 11.4 percent.
"Greece has managed to dominate the headlines. It just shows how fragile investor sentiment is. There is some relief that we have finally got a transparent bailout mechanism in place," said Henk Potts, equity strategist at Barclays Wealth.
Euro zone finance ministers approved a 30-billion-euro ($40 billion) emergency aid mechanism for debt-plagued Greece on Sunday, but stressed Athens had not requested the plan be activated yet.
Together with at least 10 billion euros expected from the International Monetary Fund in the first year, it could add up to the biggest multilateral financial rescue ever attempted. Greece's borrowing costs eased to their lowest levels in a week.
Other banks in Europe also gained. UBS rose 3.7 percent after it delivered its highest pretax profit since the start of the credit crisis began. Barclays, BNP Paribas and Bankinter rose 1.2 to 2.5 percent.
"The big test for the market will come over the course of next few days when we fully get into the first quarter earnings season. The ability of companies to meet or exceed analysts' expectations will probably determine where the markets go in the short term," Potts said.
After the markets close, Alcoa will kick off the first-quarter U.S. earnings season with banking giant JP Morgan among those reporting later in the week.
"It's still bull market conditions. Worries that we might lurch back into a deflationary slump are lessening," said Bernard McAlinden, investment strategist at NCB Stockbrokers.
PHARMA, COMMODITIES WEAKEN
Gains in banks were offset by weaker pharmaceutical shares. GlaxoSmithKline, Merck, Novartis, Roche Holding, Sanofi-Aventis and Shire fell 0.3 to 1.4 percent. Miners were also under pressure, with the European mining index down 1 percent after gaining in the previous three sessions.
BHP Billiton, Anglo American, Antofagasta, Rio Tinto, Xstrata and Eurasian Natural Resources fell 0.1 to 1.5 percent.
Among individual shares, Home Retail jumped 5.2 percent after a Sunday newspaper said the British company might be a bid target for Wal Mart-owned grocer Asda, which declined to comment.
Supermarket group J Sainsbury rose 3.3 percent after BofA Merrill Lynch upgraded it to "buy" from "underperform".
Across Europe, Britain's FTSE 100 index, Germany's DAX and France's CAC 40 were also little changed from their close in the previous session.
