Tech recovery helps European shares bounce back from 7-week lows; Capita rockets

LONDON (Reuters) - European stocks rebounded from seven-week lows in early deals on Tuesday as shares in tech firms recovered and financials rose, while British firms were led by a jump in shares in Capita (NYSE: CPI).

The pan-European STOXX 600 <.STOXX> index was up 0.5 percent, partly recovering losses from the previous session following a brutal sell-off in tech stocks <.SX8P>. The tech sector was the top sectoral gainer, up 1.1 percent after posting a 3.6 percent loss on Monday.

Gains among health stocks <.SXDP> and banks <.SX7P> also helped, with Italian lenders UBI Banca , UniCredit and Banco BPM among the biggest gainers in the sector.

Shares in troubled British outsourcing firm Capita (NYSE: CPI) jumped more than 12 percent after the group reiterated its outlook, saying that it hoped to improve its profitability and secure more contract wins in the second half of 2017 following a series of profit warnings.

Visitor attractions group Merlin Entertainments fell around 3 percent, however, after striking a cautious tone in its outlook and saying that attacks in Manchester and London had hit domestic demand.

Broker action also propelled shares in London Stock Exchange Group (NYSE: LSE) 3.3 percent higher after Credit Suisse and RBC raised their target prices on the stock. This helped Britain's FTSE 100 <.FTSE> gain 0.3 percent.

Strength in the energy sector <.SXEP> also helped underpin gains, with Petrofac the biggest oil & gas riser.

(Reporting by Kit Rees; Editing by Hugh Lawson)

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