The ECB rate cut gave a welcome boost to financials on an already busy day for the sector. BNP-Paribas put on 5 per cent to #99.80 as the French bank unveiled better than expected first-quarter results. Analysts noted that a solid performance in retail banking partially offset a fall in investment banking profits and capital gains.

ABN Amro jumped 5 per cent to #22.40, wiping out Wednesday's 1.3 per cent losses, which followed disappointing results.

Against the trend, Commerzbank edged 0.1 per cent lower to #32.30 as the group posted weaker than expected first-quarter profits. Trading and commission income fell while costs rose.

Ahead of results today, Dresdner Bank was 1.7 per cent higher at #51.20. Switzerland's UBS jumped 4.2 per cent to SFr259 (#168), while CS Group gained 3.3 per cent to SFr329 (#214).

Sharp gains among Italian asset managers helped Milan to double its morning gains around mid-session. Fund manager Banca Fideuram rose 3.9 per cent to #13.50, while asset manager and insurer Mediolanum gained 3.5 per cent to #13.60.

Among insurers, Ras, Italy's second largest group, lifted the market with news late on Wednesday of a 14.7 per cent rise in first quarter operating profits. The shares shot up 7.8 per cent to #15.09.

The drinks sector provided cheer. Shares in Danish brewery Carlsberg, under recent pressure, put on 8.2 per cent to DKr370 (#50) on better than forecast first-quarter results.

BMW shot ahead following first-quarter results that were well above the consensus range of broker forecasts. The stock broke through a fresh high for the year, gaining 5.3 per cent at #41.56, and helped lift sentiment right across the German motor sector. Volkswagen, recovering from last week's results disappointments, added 2.4 per cent at #56.70 and DaimlerChrysler 0.5 per cent at #56.66.

Technology companies generally liked the ECB rate cut and the improvement in the Nasdaq.