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STOXX 600 up 0.3%

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ECB interest rate decision due at 1215 GMT

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Husqvarna slides on Q2 sales drop

(Updated at 0838 GMT)

By Shristi Achar A

July 18 (Reuters) -

European shares rose on Thursday as gains in energy

overshadowed declines in technology stocks, although major focus

was on the European Central Bank's interest rate decision, due

later in the day.

The continent-wide STOXX 600 was 0.3% higher at

0838 GMT, on track to snap three consecutive sessions of losses.

Oil and gas boosted the benchmark index with a near

1% rise, tracking stronger crude prices.

Gains were limited by a 0.4% loss in technology stocks

, with the sector extending declines from Tuesday, as

concerns around tougher U.S. trade rules lingered.

"There's also this worry in Europe that the Trump

administration could worsen the international trade environment

and worsen the trade relationships and that is a worry that goes

beyond ASML and chip stocks," said Ipek Ozkardeskaya,

Swissquote Bank's senior analyst.

Investors also awaited the ECB's interest rate decision, due

at 1215 GMT, where the central bank is expected to keep interest

rates unchanged while signalling that its next move is still set

to be a cut, even if this guidance is likely to be vague and

carry caveats.

"We expect the ECB to set the expectations for September

rate cut... We're in a good position to do that given that the

rate cut expectations for the (Federal Reserve) in September are

now fully priced in," Ozkardeskaya added.

While a raft of downbeat earnings and trade concerns has

kept the benchmark index subdued for the week, expectations of

easing interest rates this year have gripped the investors'

attention.

Swiss stocks lost 0.5%, led by a 5.3% fall in ABB

even as the Swiss engineering group reported a slightly

better-than-expected second-quarter profit, in the final set of

numbers under departing Chief Executive Bjorn Rosengren.

Among other stocks, Publicis jumped 4.9%, as the

French advertising group upgraded its organic growth guidance

after beating expectations for the second quarter.

Essity advanced 4.1% after the Swedish hygiene

products maker reported second-quarter core earnings above

expectations.

Finnish telecom equipment maker Nokia shed 7.2%

after reporting a 32% decline in quarterly profit.

Husqvarna

slumped 13.1% to the bottom of STOXX 600 after

the Swedish garden equipment and tools maker reported a 9% drop

in second-quarter sales due to cautious consumer spending.