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London - European shares rose in early trade on Friday, with BP leading the energy sector up after a partner agreed to pay it more than $1bn towards the cost of its Gulf of Mexico oil spill.
At 08:46 GMT, the FTSEurofirst 300 index of top European shares was up 0.7% at 1 146.61 points, on track for a third day of gains, after rising 0.7% in the previous session.
BP rose 3.5% as MOEX, a unit of Japanese trading house Mitsui & Co, and partner in BP's Macondo well in the Gulf of Mexico, agreed to pay the UK oil major $1.1bn toward the cost of the massive spill last year.
The energy sector as a whole gained on stronger crude prices, as the dollar weakened. Total rose 1.1%.
London-listed commodities trader Glencore remained little changed on its second day of conditional dealing, with a market capitalisation of more than £6bn.
Wall Street edged higher on Thursday, with social network company LinkedIn soaring on its debut. "Glencore and LinkedIn getting away is positive, and strong results and cash available for transactions may encourage more M&A to give equities a push and boost valuations," said Justin Urquhart Stewart, director at Seven Investment Management.
"Most people don't see this market as being particularly stretched. But there's a concern about where the growth comes from."
Miners also gained, as the price of copper and other metals picked up. Antofagasta and Kazakhmys rose 2.1% and 2.3% respectively.
Across Europe, Britain's FTSE 100, Germany's DAX and France's CAC40 rose between 0.5% and 1%.
Standard chartered gains
The heavyweight banking sector also enjoyed the rally, up 0.6%. Standard Chartered rose 1.6% higher as UBS upgraded the Asia-focused bank to "buy" from "neutral".
But some investors remain worried about banks' exposure to the peripheral countries of the eurozone, as it struggles with a debt crisis.
Equity valuations on Thomson Reuters Datastream showed the STOXX Europe 600 carrying a one-year forward price-to-earnings of about 10.8 against a 10-year average of 13.5.
With some 90% of companies in the Stoxx Europe 600 due to report earnings in the current season having done so, 55% of that proportion have beaten or met forecasts, according to Thomson Reuters StarMine data.
The pan-European index is on track to post a 0.5% gain for the week but is "terribly rangebound", said Bill McNamara, technical analyst at Charles Stanley. "The 50-day moving average is providing some support. Resistance looks pretty firm, and it's not easy to see what will cause it to break out."
