* FTSEurofirst 300 up 0.9 pct, reversing Tuesday’s fall
* China growth beats forecasts; slowest for 18 months
* “Stars are aligned” for Veolia-Suez tie-up -Exane
* Euro STOXX 50 up 1 pct, moves above 50-day moving average (Updates prices, adds quote, detail)
By Alistair Smout and Blaise Robinson
LONDON/PARIS, April 16 (Reuters) - European shares rose on Wednesday, reversing the previous session’s slide after economic growth data from China came in a touch above forecasts.
At 1508 GMT, the pan-European FTSEurofirst 300 index was up 0.9 percent at 1,318.19 points, in a rebound most traders saw as a technical reaction to a 1 percent fall in the previous session.
Earlier this month, the index hit a near six-year high, but the rally has been halted by worries over the crisis in Ukraine as well as concerns about the pace of Chinese growth.
Data showed on Wednesday China’s economy grew at its slowest pace in 18 months in the first quarter, at 7.4 percent, though the figure was slightly stronger than the median forecast of 7.3 percent in a Reuters poll.
“The Chinese data out this morning is maybe not aggressively positive, but it certainly hasn’t done anything to derail optimism and gave markets the impetus for a strong session,” Alastair McCaig, analyst at IG, said.
French utilities Veolia Environnement and Suez Environnement both surged around 3 percent, boosted by merger speculation.
Veolia Environnement and Suez Environnement featured among top gainers after Exane BNP Paribas analysts said in a note the “stars are aligned” for the French waste and water companies to revisit the idea of a merger.
“We see up to 60 percent valuation upside from synergies in a bull scenario, while leverage should be reduced sharply, providing scope for further consolidation and/or improved shareholder remuneration,” the analysts wrote.
Britain’s FTSE 100 index was up 0.4 percent, Germany’s DAX up 1 percent and France’s CAC 40 up 1 percent, while Italy’s FTSE MIB raced 2.5 percent ahead, recouping all of last session’s losses.
The euro zone’s blue-chip Euro STOXX 50 index was up 1 percent at 3,122.63 points, moving back above its 50-day moving average, sending a positive technical signal.
While the data from China provided a spark for European indexes to rebound from recent falls, investors cautioned that without a rebound in earnings, further gains may be hard to come by.
“The Chinese data is reassuring, but at the same time company results have been quite mixed, just look at ASML. Without good earnings it’s going to be difficult to move higher,” said Arnaud Scarpaci, fund manager at Montaigne Capital, in Paris.
Shares in ASML, the world’s biggest manufacturer of tools for semiconductor chip makers, fell 5.7 percent after it trimmed its first-half sales forecast, blaming slower second-quarter sales to some customers.
Credit Suisse lost 2 percent after first-quarter net profit fell by more than a third as revenue from bond trading tumbled, raising question marks over its investment banking strategy.
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 Sudip Kar-Gupta in London; Editing by Ruth Pitchford)