STOCKS NEWS EUROPE-UK small caps rise and outpace blue-chips

The FTSE small cap index rises 0.3 percent while the junior-listedAIM shares close 0.5 percent higher, outpacing a 0.1 percent gain on theblue-chip FTSE 100 index while the FTSE 250 mid-cap index finishes up by 0.5 percent.

Insurance consultancy Jelf rises 2.7 percent after reporting a 25percent rise in earnings per share and a 4.4 percent increase in revenue, withthe stock being upgraded by SADIF to "above average" from "below average".

Salamander gains 9.1 percent after saying it had found significantgas reserves in Indonesia, prompting Canaccord Genuity to lift its price targeton the stock, which it rates as a "buy".

"The well has drilled through the shallow targets with encouraging results,"analysts at Canaccord Genuity write in a note.

"All else being equal this could suggest potential upside to resources - butmore data is required to confirm this."

Reuters messaging rm://alistair.smout.thomsonreuters.com@reuters.net