(ADVISORY- Reuters plans to replace intra-day European and UK stock market reports with a Live Markets blog on Eikon - see cpurl://apps.cp./cms/?pageId=livemarkets for site in development. See the bottom of the report for more details) Updates prices)
* FTSEurofirst 300 share index rises 1.1 percent
* Yellen comments provide support to equities
* Energy stocks boosted as oil price hits 8-month high
* Volatility could rise as Brexit vote approaches
By Danilo Masoni and Atul Prakash
MILAN/LONDON, June 7 (Reuters) - European shares rose on Tuesday after Federal Reserve Chair Janet Yellen pushed back expectations for a rate increase without raising concerns over the strength of the world's largest economy.
Yellen's remarks late on Monday followed Friday's dismal monthly jobs report, which increased jitters over the ability of the U.S. economy to absorb a rate hike as early as June. She called the jobs report "disappointing", but said "one should not attach too much significance to a single report".
Firmer oil prices also helped sentiment.
"Investors continue to see the glass half-full," JCI portfolio manager Alessandro Balsotti said. "A good day for oil prices and a balanced speech by Yellen have allowed indexes to shrug off concerns of a slowdown in the U.S. economic cycle."
In spite of the upbeat mood, investors said volatility could increase in the near term as a British referendum on June 23 over whether to leave the European Union approaches.
Surveys point to a tight race between Britons who want to stay in the EU and those who want to leave.
"Managing short term volatility by de-risking is going to be an important consideration for investors ... Global diversification will remain important for UK-based investors," said Rick Lacaille, Global CIO of State Street Global Advisors.
The pan-European STOXX Europe 600 and the FTSEurofirst 300 indexes were both up 1.1 percent by 1413 GMT, extending the previous session's slight gains.
Germany's DAX outperformed, with the share index rising 1.7 percent after data showed that industrial output in Germany rose more than expected in April. That suggests the motor of Europe's largest economy was humming along at the start of the second quarter.
Among sectoral gainers, commodities-related stocks were in demand. The energy index advanced 2.2 percent as oil prices hit their highest in eight months, buoyed by the dollar nearing one-month lows and by falling Nigerian oil output after attacks on infrastructure.
Royal Dutch Shell was up 2.6 percent, also helped by news it would sell up to 10 percent of its oil and gas production, leaving up to 10 countries to cut costs following its $54 billion acquisition of BG Group.
Shares in shipping and energy group AP Moller-Maersk rose more than 4 percent, making it the second biggest gainer on the FTSEurofirst, following an upbeat note from Danske Bank.
Today's European research round-up
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Mike Dolan, Markets Editor EMEA. (Editing by Catherine Evans)