European stocks steady; Arcelor gains

LONDON, June 12 (Reuters) European shares held firm on Monday, bucking a fall on Wall Street, while Arcelor rose after rejecting a bid from Mittal Steel but said Mittal had indicated it was keen to further improve its offer.

Arcelor rose 2 percent, while Mittal fell 1 percent.

''Even if Mittal puts a higher offer, Arcelor has swallowed a poison pill and so there are still doubts on whether Arcelor wants to go ahead with Mittal,'' said one trader.

By 0725 GMT, the pan-European FTSEurofirst 300 index was 0.2 percent stronger at 1,279.2 points, after rallying 1.7 percent on Friday.

The index is still about 9 percent below its near five-year high of 1,407.5 points struck a month ago, as inflation and interest rate worries hit markets.

Shares in Dutch retailer Ahold rallied 3 percent after the Business newspaper said UK hedge fund Centaurus Capital is leading a group of investors in building a strategic stake in Ahold, and they are weighing a break-up of the retailer among other options.

Miners Rio Tinto and BHP Billiton both declined about 1 percent as copper prices fell sharply.

On the economic front, Japan revised up GDP growth as per market estimates, keeping intact expectations that the Bank of Japan will raise interest rates as early as July.

U.S. Federal Reserve officials, including Chairman Ben Bernanke, are expected to speak later in the day.

U.S. stocks fell in a volatile session on Friday, with the Dow Jones down 3 percent in the week, its worst fall in more than a year. The Dow fell 0.4 percent on Friday.

REUTERS DKS VP1320