Banks, commods push European shares to 2-week high

* FTSEurofirst 300 index up 1.6 pct, hits 2-week high

* Financials gain; Allianz up as earnings beat forecasts

* Commodity shares up; higher crude, metals prices support

* For up-to-the-minute market news, click on [STXNEWS/EU]

Atul Prakash

LONDON, Nov 9 (Reuters) - Buoyant commodity and financial shares helped European stocks to hit a two-week high on Monday, supported by stronger crude and metals prices and after the Group of 20 pledged to keep the aid until recovery was assured.

The FTSEurofirst 300 .FTEU3 index of top European shares rose for a fourth straight session and was up 1.6 percent at 1,008.44 points by 1153 GMT. It touched an intra-day high of 1,010.07, the highest level since Oct 26.

Investors' appetite for risky assets such as equities grew, with the VDAX-NEW volatility index .V1XI falling 3.4 percent to a two-week low. The lower the index, which is based on sell and buy options on Frankfurt's top-30 stocks <0#.GDAXI>, the higher the market's desire to take risk.

Financials were among the top gainers, with DJ STOXX banking index .SX7P rising 1.8 percent. HSBC (HSBA.L), Barclays (BARC.L), Royal Bank of Scotland (RBS.L), BNP Paribas (BNPP.PA), Societe Generale (SOGN.PA) and Commerzbank (CBKG.DE) rose between 1 percent and 5.2 percent.

"It's pretty clear that the stimuli that the governments have put in the market are going to be kept and that's a positive sign for the market," said Koen De Leus, economist at KBC Securities.

"That's, for the moment, is the thing that keeps markets up, keeps economy up and adds liquidity into the system. As long as these things are kept up, the markets can rally," he added.

Group of 20 finance ministers pledged on Saturday to prepare strategies to end emergency support for their economies, but to keep the aid flowing until recovery was assured. [ID:nL7204184]

Europe's largest insurer Allianz (ALVG.DE) jumped 5.7 percent after it posted a forecast-beating rise in third-quarter profit. Allianz, which fell 8 percent over the past month, posted a 23 percent rise in operating profit. [ID:nL8291920]

The results helped lift shares across the sector, with the DJ STOXX index of European insurers .SXIP gaining 2.7 percent, while Italy's Generali (GASI.MI) rose 1.8 percent.

Prudential (PRU.L) was up 5.6 percent, also supported by AXA's (AXAF.PA) decision to buy out its Asian assets, a move traders say highlighted the value of Prudential's own Asian businesses. AXA fell 1.2 percent on its plan for a 2 billion euro ($3 billion) rights issue. [ID:nSYD420146].