* FTSEurofirst 300 up 0.2 pct, Euro STOXX 50 up 0.1 pct
* Auto makers help indexes stretch rise into 7th session
* Deutsche Post boosted by strong outlook
* ADP data disappointment would cause volatility - SocGen
By Francesco Canepa
LONDON, April 2 European shares looked set to
stretch their winning streak into a seventh straight day on
Wednesday as U.S. car sales data boosted auto stocks and
underpinned optimism about demand from Europe's largest trading
The STOXX Europe 600 Auto & Parts index rose 0.7
percent after data showed car makers reported a 5.7 percent
annual rise in U.S. sales in March, which could help them offset
still muted demand in Europe.
Sports-car maker Porsche, which saw its U.S.
sales rise 9.2 percent in March, added 1.5 percent. BMW
, which derives 17 percent of its revenue from the
United States, its largest market, rose 1.4 percent after
reporting a 7.9 percent increase in U.S. sales.
"With better U.S. sales you can compensate for weaker sales
in Europe," said Michael Punzet, auto analyst at DZ Bank.
"Clearly the premium manufacturers like BMW, Mercedes, Audi and
Porsche are best positioned to benefit from the U.S."
The car sales figures build on upbeat U.S. factory activity
data published on Tuesday, which helped send a key euro zone
index to its highest closing level since September 2008 on
optimism about demand from the United States, the world's
The data also set a positive backdrop for the release of
U.S. jobs data later this week, including non-farm payrolls on
"The U.S. is in a much better place than people were
thinking," said Manish Singh, strategist and head of investments
at Crossbridge Capital, who is long U.S. and European equity
"I expect the U.S. jobs report to be beat on Friday and I
wouldn't be surprised if it was a strong beat, but even an
in-line number or a small beat would be positive."
The Euro STOXX 50 was up 0.1 percent at 3,189.83
points at 1018 GMT, testing a 5-1/2 year high set on Tuesday.
The pan-European FTSEurofirst 300 rose 0.2 percent
to 1,344.03 points, having rallied 3.7 percent over the previous
Deutsche Post, the world's biggest postal and
logistics group, was among top gainers as it rose 3.6 percent on
the back of a bullish guidance update.
The U.S. ADP employment numbers, due at 1215 GMT, may affect
market direction later in the session as investors try to gauge
the strength of the U.S. labour market ahead of the non-farm
payrolls release on Friday.
The ADP National Employment Report is expected to show
private employers added 195,000 workers in March, up from
February. Societe Generale analysts said a disappointing figure
would send shockwaves through the market.
"We expect the ADP National Employment Report to trigger yet
another bout of market volatility ahead of the (NFP) on Friday,"
SocGen said in a note, adding they expect 150,000 net new jobs.
Traders said the Federal Reserve's renewed commitment to
keep an ultra-easy monetary policy might mitigate the market
impact of any disappointment in the data.
The market was growing more confident that the European
Central Bank would also take further steps in coming months to
stimulate the euro zone economy, such as adopting negative
overnight deposit rates, after lower-than-expected inflation
data and producer prices this week.
The ECB holds a policy meeting on Thursday although it may
hold off on action for now.
"It's not possible to predict if it will be this Thursday
but we imagine that in Q2 or Q3 there is a good possibility of
further monetary stimulus from the ECB and we think that will
take the form of negative overnight rates," Lorne Baring,
managing director of wealth management firm B Capital, said.
"The combination of monetary stimulus (and) lower macro risk
perception ... indicate that stocks will get some tailwind from
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up
(Additional reporting by Alistair Smout; Editing by Susan