European shares snap 2-day losing run

LONDON (Reuters) - European shares rose in early trade on Monday as banks recovered from concerns over tougher capital regulations and London Stock Exchange gained on acquiring rival trading platform.

By 0803 GMT, the FTSEurorfirst 300 .FTEU3 index of top European shares was up 0.6 percent at 1,019.29 points, after losing 0.5 percent in the previous session.

London Stock Exchange (LSE.L) rose 1.7 percent after it has agreed a deal to take a 60 percent stake in loss-making trading platform rival Turquoise and will merge it with its own "dark pool" platform, Baikal, to create a new pan-European venture. Banks also rose, with HSBC (HSBA.L), Barclays (BARC.L), Credit Agricole (CAGR.PA), BNP Paribas (BNPP.PA), Credit Suisse (CSGN.VX), Deutsche Bank (DBKGn.DE) and Banco Santander (SAN.MC) up 0.3-2 percent.

"It's important that we still play with the cyclicals (for 2010) because they feed very well into the demand growth in the BRIC nations," said Stephen Pope, chief global market strategist at Cantor Fitzgerald in London.

Shares in Eurotunnel (GETP.PA) shed 3.6 percent after the operating company said weekend suspensions to Eurostar rail services caused by acute weather conditions would continue through Monday while trains are modified to cope with more snow expected in northern France.

(Reporting by Dominic Lau)