* FTSEurofirst 300 index gains 0.42 percent
* Rise in U.S. crude inventories weighs
* Insurer Aegon rallies after updates (Adds details, updates prices)
By Danilo Masoni and Atul Prakash
MILAN/LONDON, Jan 13 (Reuters) - European shares rose on Wednesday but ended off their highs on some profit taking and after a rise in U.S. crude oil inventories added to concerns about a deepening supply glut.
The pan-European FTSEurofirst 300 rose 0.42 percent to 1,354.8 points, extending Tuesday's gains, but off an intraday high of 1,374 points. Germany's DAX dipped 0.25 percent.
The volatility underlined the fragility of sentiment after a rocky start to the year due to fears over a slowdown in China, which caused the FTSEurofirst to dip to a three-month low on Monday after in four straight sessions of declines.
"We are in a very volatile phase and it's not that surprising that any gains trigger profit-taking," said Giuseppe Sersale, a fund manager at Anthilia Capital, adding that the U.S. oil report was a key catalyst.
In spite of the swings, Dutch insurer Aegon held on to solid gains to end up 9.7 percent, making it the biggest gainer in the FTSEurofirst 300. The group provided an update on its strategy, gave financial targets and said it will increase its profitability and capital returns.
Commodities-related stocks were in demand, with the European mining and energy indexes rising 0.8 percent and 1.5 percent respectively, boosted by initial gains in crude and metal prices. Auto stocks were the biggest losers with a decline of 1.2 percent.
Earlier on Wednesday, sentiment was lifted slightly after data showed China's total trade fell far less than expected in December. Exports fell 1.4 percent from a year earlier, compared to a forecast 8 percent drop and a 6.8 percent decline in November.
China's central bank held the line on the yuan for a fourth straight session, calming fears of a sustained depreciation. Having been alarmed by a near 5 percent slide in the currency since August, investors appeared relieved by the relative calm.
"Markets seem to be stabilising and moving higher as sentiment is turning. The yuan is no longer moving lower, but each and every piece of data from China will be looked at with much attention," BNP Paribas Fortis Global Markets' head of research, Philippe Gijsels, said.
"Going forward, the market will focus on the earnings season that is unfolding. European earnings momentum should be reasonably strong and be supportive for the market."
Among standout gainers, Sodexo rose 2.7 percent after the food services and facilities management group posted organic revenue growth of 4.7 percent in the quarter.
European companies' earnings are expected to grow at their fastest rate in four years, significantly outpacing their U.S. peers as a weaker euro and signs of economic recovery swell profit margins. (Editing by Catherine Evans)