ISTANBUL, April 29 (Reuters) - Turkish shares rose on Tuesday on a slew of strong first quarter results, while the lira was lifted by greater risk appetite after U.S. sanctions on Russia were less stringent than expected.
The lira, which weakened on Monday as rising tensions in Ukraine weighed on emerging markets, firmed to 2.1202 against the dollar by 0735 GMT, from 2.1269 late on Monday. Last week the central bank kept its main interest rates on hold, supporting the currency.
"Risk sentiment revived slightly as sanctions on Russia were not as severe as some feared," said TEB-BNP Paribas strategist Erkin Isik. European shares rose in early trade.
He said markets were waiting for a U.S. Federal Reserve policy meeting and the Turkish central bank's quarterly inflation report on Wednesday. The report was expected to include revised inflation forecasts and some guidance on monetary policy.
The bank has said monetary policy would remain tight until the inflation outlook improves significantly. Annual inflation stood at 8.39 percent in March.
The main Istanbul share index rose 0.73 percent to 72,942 points, slightly outperforming the emerging market index which rose 0.42 percent.
Shares in petrochemical firm Petkim jumped 4.6 percent to 2.94 lira as its first-quarter net profit of 37.3 million lira ($17.55 million) beat a poll prediction of 15.6 million.
Automaker Ford Otosan climbed 3.3 percent to 23.35 lira after it said net profit rose 15 percent in the first quarter to 202.5 million lira ($95.3 million), far exceeding a Reuters poll forecast of 84.4 million lira.
Lender Halkbank, whose net profit of 530.5 million lira was also above forecasts, rose 0.74 percent.
The 10-year benchmark bond yield fell to 9.78 percent from 9.87 percent on Monday. ($1 = 2.1256 lira) (Writing by Daren Butler; Editing by Nick Tattersall and Susan Fenton)