* FTSEurofirst 300 up 0.4 percent
* China manufacturing shows expansion
* Miners, oils lead Euorpe shares higher
* Schroders climbs after BofA ML upgrade
By David Brett
LONDON, Dec 3 (Reuters) - European shares gained early on Monday, led by commodity companies , on the back of improving manufacturing data from China, which helped offset broader macro worries.
By 0842 GMT, the FTSEurofirst 300 climbed 4.14 points, or 0.4 percent, to 1,123.50. Miners were among those boosted by a survey that showed China's giant manufacturing sector had moved into expansion territory for the first time since October 2011.
"We are in an environment where the big picture risks are still there; the U.S. fiscal cliff, the euro zone and China - on two of those (China and the euro zone) arguably things have been improving," Philip Poole, global head of macro investment strategy at HSBC Global Asset Management, said.
Poole said the U.S. "fiscal cliff" of some $600 billion in automatic tax hikes and spending cuts remains a big stumbling block for investors, but that equities remain good value relative to core government debt and now is a good time to be buying them.
"What is going to drag fresh money back into this market? It is the data more than anything ... If we see some stabilisation in European data then that could see some of the money come in," he said.
Investors were bracing for euro zone factory surveys, due later in the day. The region is on course for its worst quarter since early 2009.
"The local macro economic backdrop remains very weak, but we believe that the reduction in the probability of a bad tail-risk event in the medium term, and signs of growth elsewhere, have not been adequately reflected in valuations," Nomura strategist Inigo Fraser-Jenkins said in a note.
European shares trade on a 12-month forward price-to-earnings ratio of 11.8 times, compared with an historical average of around 14 times.
Nomura maintains an "overweight" on Basic Materials for now, adds gold exposure and increases its weight in Energy to a larger "overweight".
It takes a cautious approach to defensive sectors, maintaining a zero weighting on Consumer Staples and Utilities and a significant underweight in Healthcare.
Recent fund flow data has also signalled that investors are starting to dip their toes back into battered euro zone assets after shunning them in the past few years.
The FTSEurofirst 300 ended November at the top of its recent trading range, while the Euro STOXX 50 Volatility Index, or VSTOXX, Europe's widely-used measure of investor risk aversion, hit a five-year low on Friday. That suggests investors are becoming more sanguine about the outlook for Europe and the United States.
Among individual movers, asset manager Schroders gained 2.9 percent with traders citing BofA Merrill Lynch's upgrade to "buy" which the investment bank says reflects an improving tone for asset gathering.
Meanwhile, Belgian discount supermarket chain Colruyt fell 3 percent after its first-half results came in below expectations on pricing pressures late on Friday.