European shares claw back losses, China in focus

LONDON, Sept 27 (Reuters) - European shares rose on Thursday, recovering some of their poise in the aftermath of the previous session's sharp falls bolstered by a strong rally in China, though end-quarter window dressing was likely to make trade choppy.

Asian markets rallied as investors bet that China, the world's second-biggest economy, might make take more steps to arrest a slowdown in its economic growth and prop up its beleaguered stock market.

Traders said China's central bank injected a net 365 billion yuan ($57.92 billion) into money markets this week, the largest weekly injection in history.

The FTSEurofirst 300 was 0.5 percent higher at 1,104.57 by 0710 GMT, having dropped 1.9 percent on Wednesday.

"Slightly higher this morning after a terrible performance yesterday on the back of hope that the Chinese authorities will support the stock market now that it is trading at a three year low," said Lex van Dam, hedge fund manager at Hampstead Capital, which manages around $500 million of assets.

"Quarter-end flows will be more important though I think and because equities have done so well this quarter I expect large sell programs to hit the market over the next two days."