FTSE edges higher, HSBC and Sports Direct help

* Blue-chip FTSE 100 index up 0.3 percent

* Sports Direct, HSBC up on broker comments

* Aveva surges as Schneider buys in reverse takeover

By Atul Prakash

LONDON, July 20 (Reuters) - Britain's top share index rose on Monday, boosted by the reopening of banks in Greece and positive broker comments about HSBC and Sports Direct .

The blue-chip FTSE 100 index was up 0.3 percent at 6,796.21 points by 0805 GMT after falling in the previous session.

Shares (Frankfurt: DI6.F - news) in HSBC rose 1 percent to 585 pence, adding the most points to the FTSE 100 index, after Citigroup (NYSE: C - news) raised its rating on the stock to "buy" from "neutral" and increased its price target to 635 pence from 625 pence.

"Citi's upgrade is benefiting HSBC. Despite its exposure to the Asian market, HSBC remains well capitalised and financially robust and is looking to streamline its operations wherever possible," Richard Hunter, head of equities at Hargreaves Lansdown, said.

"Some stabilisation in Greece has also helped market sentiment. If we don't hear any bad news from Greece in the next couple of days, investors will turn back to fundamentals such as quarterly earnings," he added.

Greeks banks reopened three weeks after closing to stop the system collapsing, the first cautious sign of a return to normal after a deal to start talks on a new package of bailout reforms.

Sports Direct shares rose 1.4 percent after Exane BNP Paribas (Xetra: 887771 - news) raised it target price for the stock to 860 pence from 800 pence.

Rolls-Royce rose 0.5 percent after the British engineering company, under pressure after successive profit warnings, said its aero-engine business won two new contracts totalling $2.23 billion.

But miners came under pressure after gold plunged 4 percent to its lowest level in more than five years as bullion's safe-have status took a fresh knock from mounting expectations of a U.S. rate hike.

Gold miners Randgold Resources and Fresnillo fell more than 2 percent.

Mid-cap company Aveva surged 29 percent after France's Schneider Electric (Swiss: SNE.SW - news) said it would combine its software unit with the British company in a reverse takeover designed to create a global leader in industrial software.

(Reporting by Atul Prakash; Editing by Andrew Heavens)