European shares turned flat today in technical buying led by euro zone banks, after Spain's latest debt auction met good demand.

The euro zone's blue chip Euro Stoxx 50 index traded 0.6 per cent higher at 2,220.73 points, after crossing its 50-day moving average of 2,210.32 for the first time since early March.

The FTSEurofirst 300 index of top European shares was flat at 1.014.33 points at 1pm after falling to a low of 1,006.10 earlier in the session.

Spain's Ibex and Italy's FTSE MIB led regional indices higher, up 1.2 per cent and 1.4 per cent, respectively, while the Euro Stoxx Banks index was up 1.9 per cent.

Spanish government bond yields fell further yesterday with markets relieved after the country raised over €2 billion at a debt auction, albeit with a sharp rise in borrowing costs.

Reuters