Europe shares up ahead of US data

* FTSEurofirst 300 index gains 0.7 percent

* Miners gain; Vedanta up on bullish broker note

* For up-to-the-minute market news, click on [STXNEWS/EU]

By Joanne Frearson

LONDON, March 30 (Reuters) – European shares hit a
three-week high on Wednesday, with investors positioned for
positive U.S. ADP National Employment data, while miners gained
on hopes the global economy is recovering.

The mining sector featured among the best performers, with
the STOXX Europe 600 Basic Resources (.SXPP: Quote, Profile, Research) gaining 1.8
percent. Vedanta (VED.L: Quote, Profile, Research) rose 3.8 percent as traders cited a
bullish Morgan Stanley note.

By 0858 GMT, the pan-European FTSEurofirst 300 (.FTEU3: Quote, Profile, Research)
index of top shares was up 0.7 percent at 1,133.88 points after
closing flat in the previous session.

“Follow on from the U.S. overnight, which was strong, and
the situation in Japan has not got any worse,” said Andrea
Williams, who manages 1.3 billion pounds ($2.08 billion) in
assets for Royal London Asset Management.

Wall Street was lifted by energy shares, though in weak
volumes, while the Nikkei (.N225: Quote, Profile, Research) rose 2.6 percent, with the
Bank of Japan’s purchases of exchange-traded funds lending
support.

Later in the European session, investors will closely watch
the U.S. ADP private-sector employment report at 1215 GMT which
will give traders an idea about the all important nonfarm
payroll data on Friday.

“It does not seem to want to go down despite everything that
is thrown at it. We are waiting for the U.S. jobs data,
unemployment has taken a long time to come down and recovery in
this area is important for the market,” Williams said.

She said Royal London Asset Management was positioned in the
cyclical sector.

Elsewhere, buyers came for German truckmaker MAN (MANG.DE: Quote, Profile, Research),
which was 2.8 percent higher, with traders citing a JPMorgan
share price target rise.

TECHNICALS POSITIVE

Technicals showed an upward trend. The French CAC 40 (.FCHI: Quote, Profile, Research)
traded above its 50-day moving average for the first time since
March 9 and Britain’s FTSE 100 (.FTSE: Quote, Profile, Research) was above its for the
first time since March 8.

Across Europe, the CAC gained 0.8 percent, the FTSE was up
0.5 percent and the German DAX (.GDAXI: Quote, Profile, Research) rose 1.1 percent.

Equity valuations on Thomson Reuters Datastream showed the
STOXX Europe 600 (.STOXX: Quote, Profile, Research) carrying a one-year forward
price-to-earnings of about 10.48 against a 10-year average of
13.57.

However, in the background, euro zone peripheral debt issues
remained, with investors also anticipating the results of
Ireland banking sector stress tests, which are expected to show
the extent of the banks capital needs. [ID:nWEA1605]

“The feelings are pretty bad news could be in the wings,
Irish Life & Permanent is the one looking to be in the greatest
danger,” said Peter Dixon, economist at Commerzbank.

“But, it is a relative small player in the grand scheme of
things, the bigger concern is what black holes are going to be
revealed. This could leave the financial sector very vulnerable
for further problems.”

Bancassurer Irish Life & Permanent (IPM.I: Quote, Profile, Research) suspended trading
of its shares in London and Dublin after media reports the bank
stress tests might force it into state control. [ID:nLDE72T086]

Bank of Ireland (BKIR.I: Quote, Profile, Research) fell 2 percent, however the overall
STOXX Europe 600 Banks (.SX7P: Quote, Profile, Research) gained 0.4 percent.

Elsewhere in the euro zone peripheral countries, Portugal
and Greek bond yields were set to remain under pressure
following Standard & Poor’s downgrade on Tuesday.
[ID:nLDE72S1LY]

Also, on the downside, hearing aid maker Sonova (SOON.VX: Quote, Profile, Research)
fell 7.7 percent after its chairman, chief executive and chief
financial officer resigned following an insider trading probe.
[ID:nLDE72T04Z]
(Reporting by Joanne Frearson; Editing by Hans Peters)

Europe shares up ahead of US data