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Zurich Insurance falls 3.6% on ex-dividend trade

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SocGen up on $795 mln unit sale in Morocco

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Varta ( VARGF ) slumps as its restructuring plans would fail

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Euro hits five-month low

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STOXX 600 gains 1.1%

(Updated at 0850 GMT)

By Johann M Cherian and Ozan Ergenay

April 12 (Reuters) - European shares rose to over a

week's high on Friday, with major indexes that use the euro as

the common currency trading in the green, as investors turned

optimistic after the European Central Bank hinted that it could

begin interest rate cuts as soon as June.

The pan-European STOXX 600 gained 1.1%, while the

blue-chips index gained 1% as of 0850 GMT.

Stocks in major regional economies, such as Germany

, France, Spain and Italy,

gained more than 1% each.

"Obviously, with the ECBs comments yesterday, everyone's

assuming it is 100% guaranteed that a June rate cut is going to

happen," said Gene Salerno, chief investment officer at SG

Kleinwort Hambros.

The basic resources index led sectoral gains,

with its 2.8% rise, its fifth straight week in gains, tracking

an uptick in base metals prices. The banking index was

the worst performer for the week.

Salerno added that signs of economic stabilisation in the

euro zone and trading partner China have helped gains in

cyclical sectors such as resources.

After a broadly lacklustre week, the STOXX 600 is on course

for a weekly gain of 0.7% after the ECB hinted that interest

rates could be lowered, as early as June, while uncertainty

remained if the regulator could kick off the easing cycle before

the U.S. Federal Reserve.

Expectations for imminent rate cuts have also pushed the

Euro to a five-month low.

Unchanged final March inflation readings from top economies

in the eurozone, including Germany, France and Spain, further

soothed sentiment.

Among top movers, Varta ( VARGF ) slumped 28.4% to a record

low and was on course for its worst day since September 2022

after the German battery maker said its restructuring plans

would fail to make it profitable by 2026.

Societe Generale gained 5% to top France's CAC 40

index after the lender agreed to sell Société Générale

Marocaine de Banques and La Marocaine Vie to Moroccan

conglomerate Saham Group for 745 million euros ($797.45

million).

Thyssenkrupp rose 3.9% after the firm fleshed

out details of a restructuring programme for its challenged

steel division, with measures involving job cuts that cannot yet

be quantified.

Zurich Insurance slid 3.6% to the bottom of the

Swiss blue-chip index as the Swiss group traded

ex-dividend, while Evotec rose 6.9% after Deutsche

Bank raised the German biotech firm to "buy" from "hold".

Later in the day, investors will focus on big bank

earnings in the United States.