Europe stocks end higher; Greek shares rally

Mon Dec 22, 2014 5:33pm GMT

* FTSEurofirst 300 up 0.4 pct, FTSE 100 up 0.5 pct

* Energy shares reverse early gains as oil prices fall again

* Monte Paschi drops on fears of big writedowns

* France's Soitec tumbles after profit warning

By Blaise Robinson and Sudip Kar-Gupta

PARIS, Dec 22 (Reuters) - European equities ended higher on Monday, rising for the fifth session in a row, with Greek shares boosted by the prime minister's offer to bring pro-European independents into the government.

Bucking the trend, shares in Italian lender Banca Monte dei Paschi di Siena shed 6.9 percent, hit by renewed fears of big writedowns on poorly performing loans.

Monte Paschi is expected to book around 3 billion euros ($3.7 billion) in gross loan writedowns in the last quarter, much higher than the 1.2 billion euro total booked over the previous three quarters.

However, the biggest loser on Monday was French semiconductor engineering group Soitec, plummeting 55 percent after warning on its profit outlook.

Britain's blue-chip FTSE 100 index advanced by 0.5 percent, Germany's DAX gained 0.8 percent, France's CAC rose 0.3 percent while the pan-European FTSEurofirst 300 index climbed 0.4 percent, to 1,367.00 points.

Athens' ATG equity index, which has fallen by more than 25 percent in 2014 on concerns about a disorderly exit from Greece's international bailout, rose 0.6 percent.

Prime Minister Antonis Samaras offered on Sunday to bring independents into the government and hold new elections in late 2015 if lawmakers back him to elect a new president.

Shares in oil and gas stocks ended lower, surrendering early gains as oil prices resumed their downward march on Monday after Saudi Arabia's powerful oil minister said OPEC would not cut production at any price.

Both Technip and BG fell 1.7 percent, while Eni dropped 1 percent.

"In the event of the oil price falling or even staying at these levels, a number of oil services companies just don't have businesses, or have businesses that are massively impaired," said Jon Ingram, fund manager at JPMorgan Euroland Dynamic Fund.

The MSCI World energy sector index has tumbled 30 percent since June, wiping out about $1 trillion in the market value of oil and gas shares, roughly the size of the combined annual GDP of Saudi Arabia and Qatar, data from Thomson Reuters Datastream shows.

The slump in crude oil prices, which are down by nearly half in six months, has also been pummelling the bonds of energy companies and sending shockwaves through the high-yield credit market.

Europe bourses in 2014: link.reuters.com/pap87v

Asset performance in 2014: link.reuters.com/gap87v

Today's European research round-up

($1 = 0.8170 euros) (Additional reporting by Alistair Smout in London; Editing by Pravin Char/Ruth Pitchford)