* FTSEurofirst 300 up 0.2 percent
* Euro zone services PMI, earnings help market rebound
* Bond selloff, euro rise casts shadow on market
By Francesco Canepa and Atul Prakash
LONDON, May 6 (Reuters) - European equity indexes edged higher in choppy trading on Wednesday as strong euro zone services data and corporate results offset a sell-off in the region’s government bonds and a rise in the euro.
Shares erased early losses after surveys showed euro zone businesses started the second quarter with healthy growth as a buoyant order book again encouraged them to hire more.
Danish wind turbine maker Vestas Wind, mobile phone operator Telenor and AB InBev, the world’s largest brewer, rose between 2.8 percent and 4.4 percent to be among the top regional gainers after posting better-than-expected results.
The pan-European FTSEurofirst 300 index was up 0.2 percent at 1,558.30 points by 1032 GMT after falling in five of the previous six sessions. The index is down more than 5 percent from a 14-1/2-year high hit in April.
“For me it is just an unwinding of the consensus positions: long European government bonds, long equities, short euro, long dollar,” Ankit Gheedia, a derivatives strategist at BNP Paribas, said.
“There is an unwinding of those trades ... because of Greece and because people are starting price a higher probability that a U.S. rate hike won’t happen this year.”
Despite a largely positive earnings season, which has seen 63 percent of STOXX Europe 600 companies that have reported so far meet or beat consensus expectations, European shares have given back some of the hefty gains accumulated since the start of the year.
They have been hit by a continued strengthening of the euro against the dollar amid mixed U.S. economic data and a sell-off in euro zone sovereign debt into May, when the supply of bonds is expected to exceed purchases by the European Central Bank and cash-strapped Greece faces some key repayment deadlines.
The FTSEurofirst is up nearly 14 percent this year, in a surge largely fuelled by the ECB’s asset-purchase programme and improved euro zone economic data.
French bank Societe Generale bucked the trend, however, falling 3 percent after its results, despite posting a fivefold increase in first quarter net income.
“We believe that a lack of progress on capital ratio and a mixed set of results, with notable weakness from Russia & CIB cost pressure, suggests that the stock lacks a near-term catalyst,” Citi analyst Kinner Lakhani said.
Norwegian non-life insurer Gjensidige fell 4.4 percent, the top decliner in the FTSEurofirst 300 index, after reporting first quarter pretax earnings below expectations.
British supermarkets Sainsbury‘s, Morrisons and Tesco fell 0.5 to 4.2 percent after data showed they suffered sales declines in the last three months.
The euro zone Euro STOXX 50 index was up 0.8 percent, while shares in Athens were down 0.4 percent. (Editing by Toby Chopra and Crispian Balmer)