Europe midday: Shares rise as focus shifts back to fundamentals

European equity markets rose, with investors shifting their focus back to earnings as worries about Greece subsided.

By midday, the benchmark Stoxx Europe 600 index was up 0.6%, France’s CAC 40 was 0.8% higher and Germany’s DAX was up 0.9%.

Spain’s IBEX 35 was 0.8% firmer and Italy’s FTSE Mib was up 1.4%.

In currency markets, the euro nudged 0.3% lower to $1.0800.

Banks in Greece reopened after three weeks of closure, although capital controls were still in place, with customers restricted to withdrawals of €420 rather than €60 a day.

Greece has reportedly begun paying back the €4.2bn it owes the European Central Bank, thanks to the €7.16bn bridge loan that was approved last week by the European Union.

Meanwhile, the country's coalition government has sworn in its new reshuffled cabinet; five prominent dissidents from the Syriza party were replaced.

“European markets have opened with tempered optimism, as for the first time in over a month we've managed to enjoy a weekend uncluttered by European, political and fiscal fireworks,” said Alastair McCaig, market analyst at IG.” With the relative calm that has engulfed Europe, traders are feeling a little more comfortable and focusing on equities and the deluge of corporate data hitting them in this latest reporting season.”

Over the weekend, German Chancellor Angela Merkel said in an interview with German broadcaster ARD that Germany is open to the possibility of offering further debt relief to Greece, but not write-downs, once the details of the latest bailout have been thrashed out.

Meanwhile, French President Francois Hollande called for the creation of a common Eurozone government.

Banking stocks were in the spotlight in London.

Barclays is reportedly planning to cut more than 30,000 jobs in the next two years, just days after the bank ousted chief executive Antony Jenkins. According to the sources cited by the Times on Sunday, the cuts – which are seen as the only way to address the bank’s underperformance and lift its share price - could take the bank’s global workforce to below 100,000 by the end of 2017.

Standard Chartered was on the front foot after announcing a radical management shake-up designed to restore its fortunes.

HSBC was also higher after Citigroup upgraded the stock to ‘buy’ from ‘neutral’ .

Also in London, Aveva shares rocketed after Schneider Electric said it would acquire the firm in a reverse takeover deal, beating rumoured rivals Emerson and General Electric.

Elsewhere, Rolls-Royce nudged higher after saying it has secured two new Trent 700 contracts worth more than $2bn.

Amsterdam-listed chemical company OCI NV surged after it confirmed it’s in merger talks with US fertiliser maker CF Industries Holdings.

On the downside, Tullow Oil fell after it said gas exports from the Jubilee Field to the Ghana Gas plant at Atuabo have been suspended since 3 July due to technical issue and are expected to resume mid-August.

Gold miners were under the cosh in London, with Fresnillo and Randgold both in the red as gold prices fell sharply.