* FTSEurofirst 300 up 0.5 pct in volatile trade
* Oils, miners drive rise
* Swiss Life tops losers after MLP/AWD deal
By Amanda Cooper
LONDON, Aug 14 (Reuters) - European shares ended a choppy
session in positive territory on Thursday as a recovery in
commodity prices helped energy and mining shares and fears over
price pressures were partially quelled by U.S. inflation data.
Oil and gas shares were the top performing sector on the
European market as oil <CLc1> futures held above $115 a barrel
and traders cited bullish positioning in September oil options.
StatoilHydro <STL.OL> gained 2.7 percent, while heavyweights
Royal Dutch Shell <RDSa.AS> and BP <BP.L> were up 0.5 to 1.9
percent.
U.S. core consumer inflation data for July came in largely
in line with expectations, which initially knocked markets lower
as it lowered the chances of a rate cut this year, but investors
reassessed the data and pushed stocks up.
The FTSEurofirst 300 index <> of top European shares
ended up 0.5 percent at 1,185.64 points, having swung between
gains of 1.1 percent and a loss of 0.4 percent.
The index fell 2.4 percent on Wednesday but is up 0.5
percent in August.
"This is still a bear market rally, but every time we have a
rally you have the possibility that it develops into something
more," said Philippe Gijsels, senior equity strategist at Fortis
Bank in Brussels.
"We are not telling clients to rush in because we want
confirmation. Even if this were to be the bottom, we won't go up
in a straight line either."
The FTSEurofirst has gained about 9 percent since hitting
multi-year lows in mid-July as oil prices in particular have
retreated from their all-time highs.
Base metal prices eased in afternoon trade, but the mining
sector still rallied, drawing strength from an earlier rise in
copper <MCU3=LX> and gold <XAU=>.
Antofagasta <ANTO.L> rose 4.7 percent, BHP Billiton <BLT.L>
gained 4.6 percent, Rio Tinto <RIO.L> bounced 3 percent and
Anglo American <AAL.L> was up 4.7 percent, making it the largest
individual positive weight on the FTSEurofirst 300.
DATA SUPPORTING STOCKS
With U.S. core consumer inflation showing no signs of
accelerating rapidly, particularly against a backdrop of lower
oil prices, the chances of a U.S. rate rise later this year
waned further.
Data showed that the Euro zone economy shrank
quarter-on-quarter in the April-June period for the first time
since measurements for the single currency area began in 1985.
"The markets have already discounted lower growth, and what
is likely to move them is the prospect of lower interest rates,"
said Mike Lenhoff, chief strategist at Brewin Dolphin.
"It all seems to be going in one direction, with the
negative growth in Japan and the eurozone figures ... the only
thing that's holding up the U.S. economy is net trade, and that
contribution could diminish very rapidly."
As data on both sides of the Atlantic pointed to more scope
for policymakers to leave their respective benchmark interest
rates unchanged or even lower them, banks reversed earlier
losses. UBS <UBSN.VX> rose 3.6 percent, Standard Chartered
<STAN.L> gained 4 percent and BNP Paribas <BNPP.PA> gained 1.3
percent.
Britain's FTSE 100 <> index was up 0.9 percent, while
Germany's DAX <> gained 0.3 percent and France's CAC
<> gained 0.4 percent.
Swiss Life <SLHN.VX> topped European losers, falling 8.3
percent after the insurer said it had taken a 26.75 percent
stake in German financial adviser MLP <MLPG.DE> and was buying
most of the remaining shares in another German company, AWD
<AWDG.DE>, which rose by more than 31 percent.
L'Oreal <OREP.PA> fell 4.6 percent after Morgan Stanley
downgraded the stock to "underweight" from "equal-weight."
(Additional reporting by Sitaraman Shankar in London; Editing
by Paul Bolding)
