* FTSEurofirst 300 gains 1 percent
* Miners up on China data, Vedanta production figures
* Airlines recover as bird flu worries ease
* Euro STOXX 50 Volatility Index drops 5.3 percent
By Tricia Wright
LONDON, April 10 Miners helped lift European
shares on Wednesday after trade data from top metals consumer
China fuelled expectations for improving demand.
The FTSEurofirst 300 was up 1 percent at 1,176.88
by 1048 GMT, with cyclical sectors that tend to gain with
optimism about the economy broadly outperforming those seen as
defensive plays against economic uncertainty.
This ran contrary to the unusual theme seen so far this year
where defensive stocks have outperformed their cyclical
counterparts in rising markets.
"If this is the start of the rally in this group
(cyclicals), the undertone of the market would be much more
healthy," Philippe Gijsels, head of research at BNP Paribas
Fortis Global Markets, said.
"It would strengthen my belief that this market can still
In a sign of improving investor appetite for stocks, the
Euro STOXX 50 Volatility Index, or VSTOXX, Europe's
widely-used gauge of risk aversion, fell 5.3 percent.
Miners found favour, lifted by Chinese trade data which
suggested domestic demand was gathering pace, while solid
production figures from Vedanta Resources also helped
sentiment, with the stock gaining 5 percent.
The miners added to sharp gains seen on Tuesday in the wake
of forecast-beating earnings from U.S. aluminium group Alcoa
along with benign inflation data from China which fuelled
expectations that its monetary stimulus would stay in place.
The Chinese data partly mitigated the subdued mood that has
capped European equity markets in the past week, as three
separate U.S. jobs reports came in worse than expected, cooling
optimism about the health of the world's largest economy.
The sector has slid almost 12 percent in 2013 on
concerns over falling demand, with their 12-month forward
price/earnings ratio at 11.04 times against the STOXX 600 on
12.29 times, according to Thomson Reuters data.
European airlines bounced back after last week's sharp
sell-off as initial concerns surrounding a new strain of bird
flu in China eased.
Air France-KLM - which had tumbled 12 percent
between last Thursday's close and Monday's intraday low - gained
6.4 percent on Wednesday, while IAG, which had dropped
7.8 percent over the same period, rose 3.5 percent.
EasyJet, up 4.1 percent, was also helped by a Citi
upgrade to "buy", according to traders, with the bank citing
sustainably-positive free cash flow generation.
The euro zone's blue-chip Euro STOXX 50 firmed
1.4 percent to 2,632.14, with technical analysts anticipating
range-bound trade in the near term.
Craig Erlam, analyst at Alpari, noted that the index is
finding considerable support at 2,600 - from the neckline of the
double top where highs were hit in January and March - and that
this is a level to watch.
"A break below here will be very bearish for the STOXX50E
and based on the size of the double top, should prompt a move
back towards 2,400. We may have to wait a few weeks for that key
support level to be broken though," he said.