Yellen, earnings reports bolster European shares

* FTSEurofirst 300 up 0.8 pct in best day in a month

* Strong results at Bouygues (Xetra: BYG.DE - news) contrast with weakness at RWE (LSE: 0FUZ.L - news)

* Ahold (Amsterdam: AH.AS - news) hit by cost-conscious consumers

By Toni Vorobyova

LONDON, Nov 14 (Reuters) - European shares rose on Thursday, cheered by solid earnings from Bouygues and Zurich Insurance, as well as by signs the U.S. Federal Reserve may be in no hurry to scale back stimulus under its new chief.

Janet Yellen, President Barack Obama's nominee to head the U.S. central bank, called for continued action to help the economy. Her comments eased investor concerns that the Fed could start to trim its bond purchases as soon as December or January, boosting risk assets globally.

Data showing that euro zone gross domestic product grew half as fast as expected in the third quarter put a bit of a dampener on sentiment. But with the European Central Bank active in stimulating the economy, the news was not seen as sufficiently negative to erase equities' gains.

"The economy is still growing but not that dynamically, so therefore we can be sure that tapering in the U.S. as well as in Europe will be, at its soonest, in the middle of next year. And that gives us some support for the market and therefore we are going towards the new highs in the next couple of weeks," said Oliver Roth, head trader at Close Brothers Seydler.

The pan-European FTSEurofirst 300 index closed up 0.8 percent at 1,294.27 points - its biggest daily gain in a month. The EuroSTOXX 50 benchmark of euro zone blue chips added 1.1 percent to 3,053.69 points.

Gains were capped by concerns about the negative impact of weaker economic growth on corporate earnings, prompting investors to focus on companies still able to deliver strong profits.

French conglomerate Bouygues was the top gainer among European blue chips, jumping 6.2 percent and hitting two-year highs after beating quarterly earnings forecasts thanks to cost savings and higher construction orders.

Results also helped insurer Zurich and Belgian financial services group KBC, which rose 2.5 and 3.6 percent, respectively.

Such relative bright spots though, come in an earnings season when half of European companies have missed expectations, according to Thomson Reuters StarMine data, putting STOXX Europe 600 on track for its most disappointing set of quarterly results in two years.

Underscoring the risks, German utility RWE fell 5.1 percent as it joined peers in warning of a deep crisis in Europe's energy industry that would keep a lid on growth in the foreseeable future.

Cost-conscious consumers snapping up cheaper goods, meanwhile, hit profits at Dutch grocer Ahold, sending its shares down 5.4 percent.

Public pressure for lower prices is one of the factors dampening euro zone inflation and raising the risk of deflation in the region - which would be negative for corporate earnings and equity markets as falling prices encourage companies and consumers to delay spending.

Simon Maughan, head of research at Olivetree Financial Group, said that had contributed to the underperformance of Europe relative to the United States in the past month.

"The deflation fear is driving the rotation back from European stocks into the U.S. and we think that is going to prevail until (the Euro STOXX 50) breaks the 3,100 level," he said.

"That is going to either be triggered by an improvement in growth - don't bet on it - or more decisive action from the ECB introducing unconventional measures."