Commerzbank, Aviva lead European shares higher after results
* FTSEurofirst 300 up 0.4 pct
* Commerzbank, Aviva lead rally in financial shares
* Chinese data boosts battered miners
By Francesco Canepa
LONDON, Aug 8 (Reuters) - European stocks rose on Thursday as estimate-beating Chinese data revived mining shares, and lender Commerzbank and insurer Aviva led a rally among financial shares after their first-half updates.
Shares in Commerzbank rose 15.7 percent in volume three times their 90-day average after the bank's results proved less weak than some in the market had feared after five consecutive disappointing quarters at the struggling German lender.
British insurer Aviva also rallied, up 7.6 percent, as it unveiled a larger-than-expected rise in operating profit, vindicating a group-wide shake-up after a shareholder revolt last year over its poor share price and operating performance.
The shares contributed to a strong earnings season for financial stocks, with 76 percent of companies in the sector beating or meeting consensus estimates so far, Thomson Reuters StarMine data shows.
"It's about the upside risk and clearly European financials have got that potential," said David Coombs, head of multi-asset investments at Rathbones, which manages 20 billion pounds ($31 billion) of assets.
Coombs has been adding to his positions in European shares, such as banks, exposed to an economic recovery.
Financial stocks added 2.8 points to the FTSEurofirst 300 index, which closed 4.6 points, or 0.4 percent, higher at 1,222.16 points.
The index, which shed 0.6 percent in the previous two sessions, has risen nearly 10 percent since late June, helped by improving economic data from Europe and the United States.
Material stocks, which cover metals and basic resources, were the second largest contributors, adding 1.3 index points after data showed unexpected strength in China, easing concerns about slowing growth in the world's largest consumer of metals.
The move was magnified by short sellers rushing to cover their negative bets on some mining stocks, such as London-listed Antofagasta, which had fallen 36.2 percent since the start of the year.
"Fears about China have been exaggerated, and there are quite good opportunities among beaten-down miners, even if it's just for a short-term technical bounce," a Paris-based equity and exchange-traded fund (ETF) trader said.
Short sellers borrow a security and sell it with a view to buying it back at a lower price before returning it to the lender.
Around 12 percent of Antofagasta's shares available to be borrowed were out on loan at the market close on Tuesday, compared with a 2.3 percent average utilisation rate by short sellers for Britain's FTSE 100 index, Markit data showed.
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