* European shares edge higher in early trade
* Euro off its lows as market awaits clarity on Spain
* Chinese data helps dispel worries about extent of slowdown
* U.S. stocks seen opening higher, Citigroup due to report
By Richard Hubbard
LONDON, Oct 15 (Reuters) - European shares gained and the
euro trimmed some of its losses after Chinese data offered
evidence for stronger than expected global growth on Monday, but
uncertainty over when Spain might request a bailout weighed on
Data over the weekend from China, the world's second largest
economy, showed inflation was subdued in September while exports
had rebounded at nearly twice the rate expected, helping to
dispel growth concerns ahead of GDP numbers on Thursday which
are still seen pointing to a mild slowdown.
"There is a lot of caution around because economic growth
does look difficult from where we are, while the debt situation
in Europe remains challenging," said Keith Bowman, equity
analyst at Hargreaves Lansdown.
The FTSE Eurofirst 300 index of top European shares
rose 0.45 to 1,098.14 in early trade with gains of between 0.3
and 0.9 percent for London's FTSE 100, Paris's CAC-40
and Frankfurt's DAX.
Economists polled by Reuters have indicated that China's
annual economic growth probably slowed for a seventh straight
quarter in the July-September period to expand 7.4 percent, the
weakest level since the depths of the global financial crisis.
But the latest data has clouded the outlook on whether it
would do more to shore up growth, and has added to evidence that
efforts by the world's major central banks to boost activity may
be beginning to have an effect.
"The September jump in export orders was twice as high as
expected, coming on the back of better export orders released
from Germany, Taiwan and Korea, indicating a rebound of global
trade," Morgan Stanley said in a note to clients.
Any gains in equities from the Chinese data are still likely
to be limited by worries about the health of corporate earnings,
given the slowdown in global growth already seen since June.
In the United States, where the reporting season began in
earnest last week, earnings are expected to drop 2.4 percent
compared to the June to September period of 2011; that would be
the biggest decline since the third quarter of 2009.
Preseason announcements by S&P 500 companies have also
pointed to the potential for greater weakness, Thomson Reuters
research shows. There have been 94 negative earnings
preannouncements from this group for Q3 compared to 23 positive
ones - a 4.1 ratio which is the weakest showing since Q3 2001.
On Friday, the weak outlook saw U.S. stocks post their worst
week in four months, although the market is expected to recover
slightly on Monday.
Financial institutions will dominate earnings in the coming
days, including Citigroup later on Monday, then Goldman
Sachs and Bank of America during the week.
In the foreign exchange market, the euro was flat on Monday
at $1.2945 as the long wait for Spain to request a
bailout from its euro zone partners resumed, with little scope
of solid news at an European Union summit later this week
Greek Prime Minister Antonis Samaras has said his government
expects to agree on a new austerity package with its lenders
and for the European Union and the International Monetary Fund
to bridge their differences on how to cut the country's debt at
the leader's meeting on Thursday and Friday.
But euro zone officials have said Spain is probably going to
ask for financial aid only in November. If it does the request
would probably be dealt with alongside the programme for Greece
and a bailout for Cyprus in one big package.
The Spanish request is key to market sentiment as it would
pave the way for the European Central Bank's programme to buy
bonds of struggling euro zone states that ask for assistance.
"Any policy announcement keeps getting pushed back and a
lack of political action is keeping the euro pinned down," said
Adam Myers, senior currency strategist at Credit Agricole.
The dollar was also flat against a basket of six major
currencies at 79.64 while some dollar-denominated
commodities dipped on worries the latest Chinese data may delay
any further easing by the monetary authorities in Beijing.
"There is an air of uncertainty today ... which makes it
hard to predict what (the Chinese government) will do next,"
said Andy Du, derivatives director at Orient Futures.
Copper prices fell 0.3 percent to near a one-month
low, while Brent crude oil edged down to $114.56 a
barrel. Gold extended recent losses to touch a 2-1/2-week
low of $1,741.24 an ounce.