BUZZ-Severn Trent: top of STOXX after RBC double upgrade

** British water utility Severn Trent (Other OTC: STRNY - news) up 3.5 pct after RBC double upgrades to "outperform"

** Stock top of STOXX 600 and FTSE 100

** RBC Capital Markets, in a note, says outperform rating reflects fact SVT's current trading valuation implies a total return that compares favourably against the rest of the utilities sector; raises TP to 2650p from 2400p

** Note (Stockholm: NOTE.ST - news) adds that as Ofwat improves clarity on returns and costs benchmarks, broker believes SVT’s position at the cost frontier, ability to achieve incentives will be revealed

** Broker also upgrades rating on United Utilities (LSE: UU.L - news) -- to 'Outperform' v 'Sector Perform'; says market has overpriced UU's downside risks

** Adds with low expectations, UU has the biggest potential to surprise and represents the best value amongst its water peers

** UU 4th top gainer on Stoxx 600

(rahul.b.thomsonreuters.com@reuters.net)