* FTSEurofirst 300 rebounds from 11-week closing low
* UBS upbeat on E.ON; utilities gain
* Some caution lingers over pace of economic growth
* For up-to-the-minute market news, click on [STXNEWS/EU]
By Harpreet Bhal
LONDON, June 7 (Reuters) - European shares were higher in
early trade on Tuesday, with miners among the gainers and German
utility E.ON
Traders said investors were picking up recently beaten-down stocks, though low volumes were seen exaggerating moves.
"Shares in Asia were higher so that is giving us a mild boost and some people think the falls yesterday may have been a bit overdone," said Markus Huber, senior trader at ETX Capital.
The pan-European FTSEurofirst 300 <.FTEU3> index of top shares was up 0.4 percent at 1,109.02 points by 0804 GMT, recovering from an 11-week closing low on Monday after a four-session losing run.
Utilities were among the gainers, with E.ON up 2.2 percent after UBS added the company to its "key call" list, saying the stock's 20 percent underperformance in 2011 was unwarranted.
The STOXX Europe 600 utilities index <.SX6P> rose 0.8 percent.
Mining shares were also among the heavyweight gainers, with the STOXX Europe 600 basic resources index <.SXPP> up 0.8 percent as copper prices steadied.
Across Europe, Britain's FTSE 100 <.FTSE>, Germany's DAX <.GDAXI> and France's CAC 40 <.FCHI> rose 0.2-0.5 percent.
Greek shares <.ATG> lost 0.9 percent with banks <.FTATBNK> down 1.4 percent as uncertainty remained over the resolution of the country's debt crisis, with questions remaining over how much of a hit private bondholders may have to take.
Mediobanca analysts said Greek banks would face a capital shortfall of 8 billion euros if a 43 percent haircut were applied to Greek bonds, although such a move seemed unlikely in the short term.
BERNANKE EYED
Caution was likely to persist after recent disappointing data from the United States, including weak labour market and manufacturing numbers, raised fears the pace of recovery in the world's largest economy could be slowing.
Investors will closely monitor a speech by Federal Reserve chairman Ben Bernanke at 1945 GMT for clues on the U.S. central bank's view of the slowdown and its impact on loose monetary policy.
Credit Suisse strategists said in a note recent economic weakness was just a mid-cycle slowdown, and they favoured life insurance companies, arguing government bond yields would trade higher as the recovery strengthened.
Among life insurance companies, Credit Suisse likes AXA
They also like companies which can benefit from a rise in
companies' capital expenditures. They highlighted software and
advertising companies such as SAP
However, Credit Suisse said it was too early to raise cyclicals, which have a strong correlation to the performance of the economy overall.
"We have not quite seen the normal perconditions for a mid-cycle trough in equities (but we think we are getting close, with insider buying, risk appetite and marco surprises near the levels typically seen at market lows)," they said. (Editing by Dan Lalor)