* FTSEurofirst 300 up 2.7 percent
* Index on track for eighth day of gains in last 10
* Commodity stocks top gainers on China stimulus package
By Sitaraman Shankar
LONDON, Nov 10 (Reuters) - European share prices rose in
early trade on Monday, as commodity stocks soared after China
unveiled a nearly $600-billion economic stimulus plan to boost
domestic demand.
At 0925 GMT, the FTSEurofirst 300 <> index of top
European shares was up 2.7 percent at 938.95 points, on track
for its eighth day of gains in the last 10.
The DJ Stoxx European basic resources index <.SXPP> jumped
nearly 11 percent, tracking metal prices. Rio Tinto <RIO.L>,
Kazakhmys <KAZ.L>, Xstrata <XTA.L> and Antofagasta <ANTO.L>
recorded gains of 11-13 percent.
Steelmaker ArcelorMittal <MTP.PA> jumped 15 percent, and a 4
percent rise in oil prices <CLc1> to nearly $63.50 a barrel
lifted BP <BP.L>, Total <TOTF.PA> and Shell <RDSa.L> by 3.8-4.4
percent.
China approved a $586 billion government spending package
and announced a shift to "moderately easy" monetary policy
despite having already made three interest rate cuts since
mid-September.
"Markets are latching on to ruthlessly lower interest rates
and fiscal stimulus packages as cyclical inflation pressures
have disappeared, with the structural underlying tendency for
disinflation," said Bernard McAlinden, strategist at NCB
Stockbrokers in Dublin.
"Historically cyclical bull markets have been no less
frequent or sizeable in a secular bear market than in a secular
bull market."
European shares have risen 15 percent over the past two
weeks but are still down 38 percent this year, hammered by a
credit crisis that piled up losses at top banks and slowed the
economy.
Around Europe, Britain's FTSE <> was up 2.7 percent,
Germany's DAX <> up 2.9 percent and France's CAC <>
was 3.2 percent higher.
CHOLESTEROL BUSTER BOOSTS ASTRA
AstraZeneca <AZN.L> rose 2.7 percent after data showed that
its cholesterol fighter Crestor dramatically cut deaths, heart
attacks and strokes in patients with normal cholesterol but who
have high levels of C-reactive protein.
Santander <SAN.MC> fell 3.4 percent to 8.06 euros after it
unveiled a surprise 7.2-billion euro rights issue at 4.5 euros a
share.
Europe's biggest bank, HSBC <HSBA.L>, was down 0.7 percent
after it posted a higher profit in the third quarter but took a
$4.3 billion charge for bad loans in personal financial services
in the United States.
McAlinden said that a test of whether the market was
experiencing a bull phase within a bear market was its reaction
to bad news.
"We had a weak employment report on Friday and markets
rose," he said.
U.S. employers slashed 240,000 jobs from payrolls last
month, an unexepctedly large number, and the jobless rate shot
up to a 14-1/2 year high, but the Dow Jones industrial average
<> and the S&P 500 <.SPX> notched up gains of nearly 3
percent.
(Editing by Greg Mahlich)
