* STOXX 600 up 0.1 pct, flat on the week
* Oil stocks post two-week gain of 5 pct
* Gold miners helped by flight to safety
* Real estate stocks up, banks down
(Adds details, closing prices)
By Danilo Masoni
MILAN, April 7 European shares inched up on
Friday, reversing earlier weakness as oil stocks climbed after a
U.S. cruise missile strike in Syria sent crude prices near to
The pan-European STOXX 600 index ended up 0.1
percent, also supported by precious metal miners which benefited
from a rise in prices of gold, which is seen as a safe-haven
asset. On the week the STOXX 600 was flat.
Oil stocks provided the biggest boost to the STOXX
with their sectoral index surging to its highest level in 10
weeks with majors BP, Total, and Royal Dutch
Shell all up around 1 percent.
After a sluggish start to the year energy stocks have seen a
return of interest, with investors betting that producing
countries will agree output cuts and a pick-up in merger and
acquisition activity in the sector further lifting the mood.
On Friday, analysts at Deutsche Bank were latest to turn
positive on the European energy sector, upgrading it to a
Europe's oil index has gained 5 percent over the last two
weeks, scoring its best two-week gains since mid-December.
Precious metals miners were among the top gainers on Friday
as investors fled to low-risk assets such as gold, which hit a
five-month high amid rising global security tensions.
Shares in Randgold Resources rose 4.3 percent, the
second biggest gainer on the STOXX after oil firm Tullow Oil
, while silver and gold miner Fresnillo added
Defence firm BAE Systems added 2.4 percent, in line
with U.S. peers Lockheed Martin and Raytheon,
which makes the Tomahawk cruise missiles used in the strike.
European shares touched the day's lows after disappointing
U.S. non-farm payrolls data. But traders said the figures had
not changed expectations surrounding monetary policy in the
world's largest economy.
"The overall trend remains one of very strong job creation.
This alone won't stop the Fed from hiking twice more this year.
A war in Syria might -- geopolitics has taken on much greater
significance again," said ETX Capital analyst Neil Wilson.
Elsewhere price action was dictated by broker moves.
British online grocer Ocado fell 5.4 percent after
UBS cut its rating on the stock to 'sell' from 'buy', while
upgrades from RBC boosted merging fund managers Standard Life
and Aberdeen Asset Management.
Real estate stocks surged to fresh six-month highs,
supported for a second day by expectations that the European
Central Bank will remain cautious on any tightening measure
following recent lower-than-expected inflation data.
Real estate stock benefit from low interest rates, which
make their yields more attractive. Banks, which instead
see bigger lending margins when interest rates rise, fell 0.2
percent on Friday.
(Reporting by Danilo Masoni; Additional reporting by Helen
Reid; Editing by Catherine Evans)