* FTSEurofirst 300 up 0.7 pct
* Ukraine rebels hand over black boxes from Malaysian plane
* Actelion top riser as results revive M&A speculation
By Francesco Canepa
LONDON, July 22 European stocks rebounded on
Tuesday with traders hoping for an easing of tensions between
Russian and the West after pro-Russian rebels agreed to hand
over the black boxes from the Malaysian plane downed in Ukraine
By 0721 GMT, the pan-European FTSEurofirst 300 index
was up 0.7 percent at 1,364.75 points.
Heightened tensions between Russia and the West following
the plane incident and the prospect of harsher Western sanctions
on Russia, combined with escalating violence after Israel's
ground offensive in Gaza, have weighed on equities in the past
week and traders expected the market to remain jittery.
"There will probably be some relief early on but with some
risk-off remaining," Mike Reuter, a broker at Tradition, said.
"There's no resolution to the conflict. Fighting in Donetsk
continues and the Gaza conflict is also ongoing."
European Union foreign ministers were scheduled on Tuesday
to discuss further penalties against Russia, but the most they
are expected to do is to speed up the implementation of
sanctions against individuals, and possibly companies, agreed in
principle last week before the plane was brought down.
"Co-operative steps from the pro-Russian rebels have soothed
traders' fears that East-West relations are about to resemble
the Cold War era," Capital Spreads dealer Jonathan Sudaria said
in a trading note.
ACTELION STANDS OUT
Actelion, Europe's largest biotech company, was
the top FTSEurofirst 300 riser, gaining 4 percent after it hiked
its 2014 profit forecast for the second time this year.
While the firm's chief executive said his strategy to stay
independent was supported by shareholders, traders speculated on
possible bids from larger firms such as AstraZeneca,
Roche, GlaxoSmithKline or Novartis.
"Actelion is the answer to AstraZeneca's chronic pipeline
shortage, GlaxoSmithKline's need for expansion and would be an
easy morsel for Roche or Novartis to digest," Hobart Capital
Markets trader Justin Haque said.
Elsewhere, corporate updates were less upbeat with French
media group Publicis Group and Norwegian aluminium
producer Norsk Hydro both disappointing.
Their shares fell 5 percent and 2.4 percent, respectively.
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up
(Editing by Louise Ireland)