European shares break losing streak; miners rise

* FTSEurofirst 300 rises 0.6 percent

* Index gains after three days of losses

* Miners and oils rise

By Brian Gorman

LONDON, July 7 (Reuters) - European shares were higher in midday trade on Tuesday, after three days of losses, as surges by banks and miners more than offset declines in drugmakers and telecoms.

At 1058 GMT, the FTSEurofirst 300 .FTEU3 index of top European shares was up 0.6 percent at 838.38 points in a choppy session, after falling 1.1 percent on Monday for its third straight losing session.

"We are bouncing around on very low volumes," said Howard Wheeldon, strategist at BGC Partners, in London. "We may continue moving sideways for many months. The worst of the crisis may be over, but we're not seeing recovery."

Miners were among the outstanding gainers, as the price of copper and other metals picked up following recent weakness.

Anglo American (AAL.L), Antofagasta (ANTO.L), BHP Billiton (BLT.L), Lonmin (LMI.L), Rio Tinto (RIO.L), Vedanta Resources (VED.L) and Xstrata (XTA.L) were up between 3.3 and 4.6 percent.

Speculation on a possible acquisition also helped.

"Vale (VALE5.SA) has a $1 billion convertible fundraising. Obviously, the market views the money could be used as a platform for acquisition," a London-based trader said.

The crude price CLc1 also bounced, up 0.7 percent at $64.47 a barrel, boosting energy shares. Total (TOTF.PA), ENI (ENI.MI), BP (BP.L) and StatoilHydro (STL.OL) rose between 0.6 and 1.5 percent.

Across Europe, Britain's FTSE 100 .FTSE, Germany's DAX .GDAXI and France's CAC 40 .FCHI rose between 0.9 and 1 percent.

The pan-European index is up nearly 30 percent from the lifetime low it hit on March 9, but the rally stalled last month amid worries on the timing and strength of the recovery.

Stock markets are about half way through an expected 10-15 percent downward correction from recent peaks, said Christian Heger, Chief Investment Officer at HSBC Global Asset Management in Germany. [ID:nL7730813]