Strong miners lift European shares near 6-mth high

                                
 * FTSEurofirst 300 ends up 0.3 percent 
                                
 * Miners strong as weak dollar lifts metals prices
                                
 * Hermes surges after LVMH buys minority stake
                                
 
                                
 By Harpreet Bhal 
                                
 LONDON, Oct 25 (Reuters) - European shares rose on Monday,
with miners up as a weak dollar lifted metals prices, while
luxury goods group Hermes <HRMS.PA> surged after peer LVMH
<LVMH.PA> bought a minority stake in the French handbag maker.
                                
 The pan-European FTSEurofirst 300 <.FTEU3> index of top
shares closed 0.3 percent higher at 1,092.23 points, near a
six-month high at 1,096.31 hit on Thursday.
                                
 Heavyweight miners were among the biggest gainers, with the
STOXX Europe 600 basic resources index <.SXPP> up 2.1 percent as
copper prices climbed to a 27-month high on a weak dollar,
falling stocks and strong demand from China. 
                                
 Dollar selling persisted after the outcome of a G20 meeting
signalled a status quo in currency markets, with the U.S. unit
staying under pressure on expectations the U.S. Federal Reserve
will embark on further quantitative easing at a meeting in
November. [ID:nTOE69N00P]
                                
 Equity markets have been buoyed in recent weeks on hopes the
Fed may pump anything between $500 billion to $1.5 trillion into
the economy to spur the recovery. [FED/R]
                                
 "These moves are now pricing in more quantitative easing so
the chances are that when we do get that in November the moves
may already be in the market," said James Hughes, market analyst
at CMC Markets.
                                
 Analysts at Goldman Sachs said the Fed was almost certain to
announce renewed monetary easing at next week's policy meeting,
adding it may announce $500 billion in asset purchases or a bit
more over a period about six months, and that the size could
eventually reach $2 trillion. 
                                
 "Closer to the time we will start getting more conversations
about how much it (quantitative easing) is going to be. One
trillion dollars is the general consensus at the moment," Hughes
said.
                                
 Across Europe, Britain's FTSE 100 <.FTSE> rose 0.2 percent,
Germany's DAX <.GDAXI> was up 0.5 percent and France's CAC 40
<.FCHI> closed flat. 
                                
 In a positive sign for equities, the 50-day moving average
on the euro zone's blue chip STOXX Europe 50 index <.STOXX50E>
inched closer towards its 200-day moving average. The crossing
of the two indicators, known as a golden cross, signals a
bullish trend. 
                                
 
                                
 M&A BOOSTS LUXURY FIRMS
                                
 Individual gainers included Hermes, which surged 15 percent
after peer LVMH said it was buying a minority stake worth 1.45
billion euros ($2.0 billion) in the family-controlled handbag
maker, but would not seek to take over the group or influence
its strategy. [ID:nLDE69M05T]
                                
 LVMH rose 2.4 percent, while peers Swatch <UHR.VX>,
Richemont <CFR.VX> and Burberry <BRBY.L> added 1.7-3.2 percent.
                                
 Automakers were also higher led by a 6.8 percent gain in
Volkswagen <VOWG_p.DE>, after Credit Suisse hiked its share
price target to 130 euros from 102, reiterating its "overweight"
rating, following results on Friday. [ID:nLDE69O0FR]
                                
 TeliaSonera <TLSN.ST> gained 1.6 percent after raising its
2010 outlook when posting a higher than expected quarterly
profit thanks to smartphone usage at home and economic recovery
in emerging markets. [ID:nSAT008855]
                                
 "The third-quarter reporting season has been very strong,
with majority of companies exceeding analysts' expectations and
that continues to be a very supportive theme," said Henk Potts,
equity strategist at Barclays Wealth. 
                                
 The market also received a brief boost from data showing a
bigger-than-expected rise in sales of previously owned U.S.
homes in September, but the numbers remained at levels below the
pace normally associated with a healthy market. [ID:nN25265199] 
 (Additional reporting by Atul Prakash; Editing by Dan Lalor)