European shares rise led by commods, banks

* FTSEurofirst rises 1.2 percent

* Energy adds most points on back of higher oil price

* China PMI above 50, lifting basic resources

By Peter Starck

FRANKFURT, July 1 (Reuters) - European shares rose early on Wednesday as energy stocks drew strength from higher oil prices and Chinese economic data gave a lift to resource stocks such as steelmaker ArcelorMittal (ISPA.AS).

By 0917 GMT, the pan-European FTSEurofirst 300 .FTEU3 index of top shares was up 1.2 percent at 860.09 points, boosted also by banks, notably Commerzbank (CBKG.DE) which shot up on news of a political deal giving German banks greater scope than before to rid balance sheets of toxic assets.

The European benchmark index rose 2.2 percent in the first half of 2009 thanks to a gain of 15.9 percent in the second quarter, after hitting a lifetime low on March 9.

The second-quarter rally came to a halt by mid-June and the FTSEurofirst has remained range-bound since then. It fell 1.1 percent on Tuesday.

"Some investors seem to be ready to buy on the dips," said LBBW analyst Michael Koehler.

"There is no clear downward dynamic," he added.

Other strategists said many investors appeared to be on hold, awaiting the U.S. second-quarter corporate earnings season kicking off with bellwethers such as Alcoa AA.M on July 8 and Intel (INTC.O) and Johnson & Johnson (JNJ.N) on July 14.

"Q2, 2009 earnings revisions have now turned positive with the season only a week away, a striking contrast to recent seasons where estimates declined coming into reporting," Goldman Sachs said in a research note.

That, said JPMorgan, was making investors cautious.

"The view is that (consensus earnings) expectations have moved too far too fast, setting the scene for a disappointment," JPMorgan said in a June 30 strategy note.

Oil & gas .SXEP added the most points to the FTSEurofirst early on Wednesday, with Royal Dutch Shell (RDSa.L), BP (BP.L) and Total (TOTF.PA) up between 1.7 percent and 1.8 percent.