* FTSEurofirst 300 down 0.07 pct, Euro STOXX 50 down 0.2 pct
* Both indexes bounce off major support levels
* Time to cash in gains on put options -UBP's Kalfon
By Blaise Robinson
PARIS, June 13 (Reuters) - European shares ended broadly
steady on Thursday, recovering from the session's lows after
upbeat U.S. retail sales and a drop in jobless claims prompted
bargain hunters to pick up battered mining and banking stocks.
The better-than-expected U.S. data fuelled expectations the
economy is shaking off a soft patch seen in the past few weeks,
eclipsing recent worries the Federal Reserve could soon start to
scale back its stimulus measures.
"We think the Fed will start to trim the amount of bonds it
buys around the third quarter, but it shouldn't spark a sell-off
in equities because the Fed's move will in fact confirm that the
U.S. economy is in a better shape," said Benoit Peloille, equity
strategist at Natixis, in Paris.
The FTSEurofirst 300 index of top European shares
closed 0.07 percent at 1,173.98 points, while the euro zone's
blue-chip Euro STOXX 50 index ended 0.18 percent
lower at 2,661.71 points.
The two indexes had fallen as much as 1.7 percent and 1.9
percent respectively earlier in the session, with both testing
major support levels representing 200-day moving averages,
before bouncing back, sending a positive technical signal.
"Volatility should stay high until next week's Fed meeting,
where they will probably try to calm down the market," said
Bernard Kalfon, head of volatility strategy and risk management
at Geneva-based Union Bancaire Privee, which has 83 billion
Swiss Francs ($90.1 billion) in assets under management.
The Euro STOXX 50 Volatility Index, known as the
VSTOXX, surged as much as 9.9 percent on Thursday to a 3-1/2
month high of 23.8, before losing steam to 22.11.
The VSTOXX, Europe's gauge of investor sentiment which is
based on put and call options on Euro STOXX 50 stocks and is
used to measure the cost of protecting stock holdings against
market corrections, has soared 40 percent since mid-May.
"The volatility has risen quite a lot already in the past
few weeks, and we've started to book profits on put options at
these levels. I don't expect a serious drop in stocks... It
remains the most attractive asset class," UBP's Kalfon said.
Around Europe, UK's FTSE 100 index gained 0.08
percent, Germany's DAX index fell 0.6 percent and
France's CAC 40 inched 0.1 percent higher.
Among the day's top gainers were miner Rio Tinto, up
2.6 percent, French bank BNP Paribas, up 1.6 percent,
and Italian lender UniCredit, up 2.5 percent.
Mining shares - by far the worst sector so far this
year, down 21 percent - got a boost from news that China plans
to scrap its decade-old iron ore import licensing system, a move
that could lift the country's imports.