* STOXX 600 up 0.2 pct
* ING gains on profit beat
* BT rallies as outlook improves
* Shell, TGS lead oil stocks lower(Updates prices, adds details)
By Danilo Masoni and Helen Reid
MILAN/LONDON, Nov 1 (Reuters) - European shares hit atwo-week high on Thursday as strong results from Dutch bank INGand UK telecoms group BT helped offset a disappointing updatefrom Credit Suisse, and ASM International brought some cheer tochipmakers.
The pan-European STOXX 600 hit a two-week high butthen lost steam over the session, ending with a 0.2 percentgain. Germany's DAX declined 0.1 percent.
European shares built on Wednesday's rally when freshoptimism over earnings helped ease worries over economic growthand political risk which sent the pan-European index close totwo-year lows in October.
Miners, banks and retail - sectors highly sensitive to theeconomic cycle - led the gains, in a reversal of the patternduring the sell-off, which saw cyclicals underperform.
Britain's FTSE lagged, down 0.5 percent, as thepound strengthened after a British official said London wasclose to sealing a deal that would give UK-based financialservices firms basic access to EU markets.
ING shares rose 5.9 percent after the largestDutch bank reported a better-than-expected profit of 776 millioneuros, as it continued to grow on an underlying basis despitebeing fined for failures to prevent money laundering.
"ING's earnings are mainly boosted by the lower cost/incomeratio as its cost cuts seem to start reaping benefits," saidJauke de Jong, a research analyst at AFS Group in Amsterdam.
BT rallied 8.7 percent after it reported abetter-than-expected 2 percent rise in first-half earnings andnudged its guidance for the full year higher. Thestock was on track for its best day since May 2013.
Results from ING and BT lifted the banks and telecomsindexes up 0.9 and 2 percent respectively, bringing relief tosectors which have been among the worst perfomers so far thisyear in Europe and have suffered due to their poor earningsoutlook.
ASM International rallied 10.9 percent, itsbiggest one-day gain since 2009, after issuing a bullish outlookthat countered fears of a downturn in the semiconductor market.
Leading the STOXX were two biotech firms, Morphosys andArgenx, which both surged.
Morphosys jumped 16.3 percent after it releasedencouraging results for its leukemia drug MOR 208. Argenxgained 13.4 percent after new data for its Cusatuzumabdrug, also to treat leukemia.
Credit Suisse was a weak spot.
Its shares fell 2.1 percent after its third-quarter netprofit fell short of expectations, even after the bank said itwould return to the black in the full year for the first timesince Tidjane Thiam became chief executive in 2015.
Oil stocks fell after Shell slightly missedexpectations, sending its shares down 3.3 percent.
Weaker crude prices also weighed on the sector, down 2.6percent.
The fall in fuel prices helped airlines outperform, however,with Lufthansa leading the DAX with a 7.1 percent riseand Air France also up strongly.
The travel and leisure sector - a laggard this year- had its best day since June 2016, up 2.6 percent.
Getinge shares fell 7.9 percent after the U.S.Food & Drug Administration said it was evaluating recent reportsof Getinge's intra-aortic balloon pump devices shutting downwhile running on battery power. https://bit.ly/2RzwBvZ
Shares in seismic oil services firm TGS dived 9.8percent to their lowest since early May after its third quarteroperating profit fell more than expected.
Wacker Chemie gained 9.6 percent, with analystssaying the highly-shorted chemicals stock was benefiting from aNordLB upgrade to "buy".
Overall, European earnings are expected to have risen 14.2percent in the third quarter, up from a previous forecast ofless than 13 percent, according to IBES Refinitiv data.
By the end of the week, companies representing around 40percent of the STOXX 600's market cap will have reportedquarterly results.(Reporting by Danilo Masoni and Helen Reid; Editing byJosephine Mason and Andrew Roche)
