* FTSEurofirst 300 index up 0.6 pct, STOXX 600 up 0.6 pct
* STOXX 600 charts show buying momentum building up
* Strong Chinese data boosts mining stocks
* SABMiller lifted by emerging market growth
* Volume light as Wall St shut for Thanksgiving
By Francesco Canepa
LONDON, Nov 22 European shares rose for a fourth
consecutive session in thin volume on Thursday as strong Chinese
data and results from SABMiller encouraged some investors to bet
on a continuation of the recent bounce.
SABMiller was the top riser, adding 6.9 percent in
volume three times the average after the world's second-biggest
brewer reported strong growth in Africa and Latin America, which
it expects to continue.
Heavyweight basic resources stocks were also well bid, up
0.7 percent, after a Chinese private manufacturing index hit a
13-month high, a sign that the pace of economic growth has
revived in the world's largest consumer of metals.
"Any time you get positive data out of China and potential
for sustained demand, the natural thing is to pick up some
mining stocks," Oliver Stansfied, director of equity sales at
He also flagged interest in UK oil major BG Group, up
1.2 percent to 1,230 pence, as the shares successfully rebounded
from a two-year low of 990 pence but still looked cheap compared
to a 1,350 pence price before the group issued a profit warning
earlier this month.
They helped the pan-European FTSEurofirst 300 index
index close 0.6 percent higher 1,103.43 points - up 3.4 percent
since last Friday, the best weekly performance since February -
albeit in low volume of 67 percent the average as Wall Street
was shut for Thanksgiving Holiday.
Weekly technical charts on the broader STOXX 600
index showed buying momentum was piling up after the index's
Relative Strength Index bounced off a line connecting lows hit
last June and in September 2011.
"If we close at current levels tomorrow that will probably
lead to a test of the multiple tops that you have seen during Q3
and Q4 (at 276 points)," Anders Soderberg, a technical analyst
at SEB in Stockholm.
"It might well find strength enough to move to a marginal
new high somewhere around 280 or slightly above that."
Barring a break above the index's 2011 high at 300, which
would trigger further gains, Soderberg believed the index was
still bound to move sideways and test its 2012 lows in the
235-240 area early next year.
POSITIVE 2013 OUTLOOK
Longer-term investors saw value in European shares next year
as bond purchases from central banks pushed bond yields down and
an intervention pledge by the ECB eased the risk of a euro
"Bonds look very unattractive and we're quite positive on
core European equities at the moment," Jason Hollands, managing
director at Bestinver, said.
"Notwithstanding the ongoing economic challenges, we feel
that there are many high-quality global brands that happen to be
domiciled in Europe."
He flagged Swiss food maker Nestle as one of them,
while he recommended steering clear of Europe's debt-laden
Bank of America-Merrill Lynch also recommended buying U.S.,
UK and continental European equities this year, although they
warned a rally into the end of the year would depend on good
economic data and a positive outcome to budget talks in the
The bank tipped hedging long positions with shorts on the
European insurance sector, which has rallied 35 percent
since June, and options to sell the S&P 500.
The more positive investor attitude towards Europe was also
reflected gap by a narrowing gap between U.S. and European
According to Thomson Reuters Datastream, the broad STOXX 600
trades at 11 times its 12-month forward earnings,
versus a price-to-earnings ratio of 12.1 for Wall Street's S&P
A gap of 1.16 between the two ratios is the smallest since
May 2006, before the start of the financial crisis in 2007, and
well below a 10-year average gap of 1.93.