* FTSEurofirst 300 up 0.6 pct, Euro STOXX 50 up 0.7 pct
* Indexes bounce after steepest three-day fall since June
* Spanish banks rally as economy recovers
* SKF, Getinge rise after quarterly updates
By Francesco Canepa
LONDON, Jan 28 European shares snapped a
three-day fall on Tuesday, helped by strong Spanish economic
data, encouraging updates from some industrial companies and a
stabilisation in emerging market assets.
Sentiment was supported by expectations that more central
banks in developing countries will follow India's footsteps and
tighten their policy to defend their currencies, helping stem a
rout that has hammered risky assets globally since last week.
Spanish banks were among Europe's top gainers, rising 1.8
percent after the country's Economy Minister Luis de Guindos
said that gross domestic product would grow more than previously
forecast this year.
Spain's Ibex rose 1.2 percent, outperforming the
pan-European FTSEurofirst 300 index, up 0.6 percent at
1,297.82, and the Euro STOXX 50, up 0.7 percent at
3,036.58 points at the provisional close.
The FTSEurofirst 300 had fallen 4.2 percent between Thursday
and Monday, its steepest three-day fall since June 2013, as
investors fretted about the combined effect of slower Chinese
growth, reduced U.S. monetary stimulus and domestic problems in
emerging countries from Turkey to Argentina.
European stocks, and especially those in the periphery, were
seen by some as possible beneficiaries from the recent flight
from emerging market assets, thanks to improving growth
prospects and still low valuations.
"No need to bottom-fish in emerging markets just yet. We
still find the euro zone recovery theme to be more interesting,"
said JP Morgan's European equity strategist Mislav Matejka.
This view was based on the assumption that the emerging
market rout will not grow to a size sufficient to jeopardise
"The perception among most investors is still that it's a
temporary shock and not the start of a crisis," said Joost van
Leenders, investment specialist for allocation and strategy at
BNP Paribas Investment Partners.
"Our overweight in (developed market) equities is based on
an improvement in the economies' outlook, which we think will
lead to an improvement in earnings too."
SKF, the world's biggest bearings maker and a
bellwether for global manufacturing, said it expected higher
demand in the coming months as an economic recovery takes hold
on both sides of the North Atlantic and eclipses a slowdown in
some emerging markets.
Shares in firm rose 5.5 percent in volume six times its
average for the past 90 days.
Swedish medical technology firm Getinge rose 4.3
percent after saying its markets in western Europe had started
Sunrise Brokers' equity strategist Chris Mellor said the
recent share price pullback could be a good opportunity to add
to equity holdings in developed markets at cheap prices.
"I view the recent pull-back in equities as offering a
buying opportunity rather than being a prompt to reduce our
equities overweight," said Mellor.
"The problems in emerging markets may have further to run
but balanced against this we continue to see better data in the
developed world," he added.