By Peter Starck

FRANKFURT (Reuters) - European stocks rose on Tuesday, led by Nokia, after a top executive said the mobile phone maker had not felt much of an impact from the U.S. economic slowdown, and with banks' strong tracking Wall Street.

The FTSEurofirst 300 index of top European shares closed 3.2 percent higher at 1,266.03 points, narrowing its losses so far this year to 16 percent.

Nokia advanced 8.2 percent after Chief Financial Officer Rick Simonson was quoted as having told Bloomberg Television that the company had not felt much of an impact from the U.S. downturn.

Chipmaker Infineon, for which Nokia is an important customer, rose 10.5 percent.

The DJ Stoxx technology index was the best sectoral performer with a rise of 6.4 percent as Nokia's leap late in the session gave a boost that helped offset an earlier Morgan Stanley downgrade of the sector to "underweight" from "neutral".

Financials held centre stage for most of the day in the wake of solid gains in U.S. stocks on Monday after investment bank JPMorgan raised its offer for rival Bear Stearns to $10 a share from $2 in a deal backed by the Federal Reserve.

In Europe, HBOS rose almost 15 percent, Royal Bank of Scotland added over 9 percent and UBS climbed more than 8 percent.

"We are catching up with yesterday's gains in the United States, that's why Europe is strong today," a trader said. "(European) banks are up because of the Bear Stearns deal."