* FTSEurofirst 300 rises 1.3 pct
* Miners lifted by speculation of China central bank action
* Credit Suisse has end-2014 target of 3,600 for EuroSTOXX50
By Sudip Kar-Gupta
LONDON, March 25 European shares rebounded on
Tuesday, lifted by expectations of stimulus measures from the
European Central Bank (ECB) and the Chinese central bank to help
their economies fight off any slowdown.
Mining stocks were the best-performers, rising on
speculation that weak manufacturing data might prompt Beijing to
launch stimulus measures in the world's biggest metals
European stocks were also buoyed after ECB governing council
member Jens Weidmann said the bank was not ruling out buying
loans and other assets from banks to support the euro zone,
which is slowly recovering from a sovereign debt crisis.
The pan-European FTSEurofirst 300 index, which rose
16 percent in 2013 to post its best annual gain since 2009,
advanced 1.3 percent to 1,310.13 points by 1521 GMT, bouncing
back from a 1-percent decline in the previous session.
The euro zone's blue-chip Euro STOXX 50 index
rose 1.4 percent to 3,096.86 points while the STOXX Europe 600
Basic Resources index - which includes top mining stocks
- outperformed with a 2.6 percent climb.
"The mining sector is the obvious place to benefit from any
stimulus package in China," said Scott Meech, co-head of
European equities at Union Bancaire Privee (UBP), whose
portfolio includes shares in miner Rio Tinto .
"We look to be at the bottom end of trading ranges here, but
I think the market will want to push up from here," he said.
STICK WITH STOCKS?
The FTSEurofirst 300 index rose to a 5-1/2-year high of
1,353.47 points in late January, but has since slipped back.
Concerns about a slump in emerging markets, coupled with
geopolitical tensions caused by Russia's seizure of Crimea this
month and the impact of an eventual rise in U.S. interest rates,
have contrived to knock back stocks from those peaks.
Credit Suisse's global equity strategy team decided to halve
its "overweight" position on equities due to these factors.
However, Credit Suisse kept an end-2014 target of 3,600
points for the Euro STOXX 50, up about 16 percent from today's
levels, arguing that a recovery in company earnings would help
European stock markets continue to rise.
Barclays' equity strategists also said stocks remained a
better asset class bet than bonds, where returns would be hit
further by any central bank measures.
"Fundamentals still support our preference for stocks over
bonds," said Rob Bate, at Barclays' European equity product
"Equity valuations are not worryingly overstretched in our
view and the current, favourable, environment of low inflation,
modest growth and very supportive monetary policy is likely to
persist over the next several months," he said.
(Additional reporting by Atul Prakash and Blaise Robinson;
Editing by Louise Ireland)