UPDATE 2-Europe closes higher as upbeat China data boosts German shares

* Trade-sensitive German shares gain on upbeat China data
* Hopes of dovish ECB support risk appetite
* Galapagos surges to record after Gilead raise stake

(Updates to close)
By Sruthi Shankar
July 15 (Reuters) - European stocks ended higher on Monday
as trade-sensitive German equities took heart from surprisingly
strong Chinese data after worries about domestic growth led to a
shaky start.
Frankfurt-listed shares .GDAXI had briefly dipped into the
red in early trade after Germany's economy ministry pointed to
weakness in the manufacturing and services sectors, suggesting a
subdued second quarter for Europe's largest economy.
The DAX index ended 0.52% higher, however, with investors
counting on the European Central Bank to signal further easing
of monetary policy at a meeting next week given slowing growth.
"The markets rebounded as investors realised this affirms a
growing conviction the ECB is getting ready to tee-up looser
monetary policy," Stephen Innes, managing partner at Vanguard
Markets Pte, wrote in a note.
The pan-European STOXX 600 .STOXX rose about 0.4% in a
choppy trading session, with sectors exposed to trade headlines
including automakers .SXAP , chemicals .SX4P and basic
resources .SXPP companies topping gains.
Buoying risk sentiment was data from China that showed
factory output and retail sales topped forecasts in June.
Although economic growth slowed to 6.2% in the second quarter,
its weakest pace in at least 27 years, it was in line with
analysts' expectation. "The June data... is an imminent upturn, markets seem to be
growing a bit more confident that the stimulus we've seen from
Chinese authorities over the past six to nine months is actually
working its way through the system," said Florian Hense,
European economist at Berenberg in London.
Regional chipmakers gained after a senior U.S. official said
the United States may approve licenses for companies to re-start
new sales to blacklisted Chinese telecoms equipment maker Huawei
HWT.UL in as little as two weeks. Infineon IFXGn.DE , ASM ASMI.AS and STMicroelectronics
STM.MI rose between 0.6% and 3.7%.
Shares of Belgian-Dutch biotech firm Galapagos NV GLPG.AS
jumped 19% to a record high after U.S. drugmaker Gilead Sciences
Inc GILD.O said it would invest $5.1 billion in the
company. Banking stocks .SX7P ended flat, drawing little cheer from
U.S. lender Citigroup Inc's C.N better-than-expected results,
as Italian banks .FTIT8300 dragged.
Investors will turn to earnings from heavyweights in Europe,
with technology major SAP SAPG.DE , semiconductor player ASML
ASML.AS and drugmaker Novartis NOVN.S among those due to
report second-quarter results this week.
Companies listed on the pan-European STOXX 600 index are
expected to report 0.8% earnings growth in the second quarter,
down sharply from an estimate of 1.8% a week ago, according to
data from I/B/E/S Refinitiv.
Falling the most of the STOXX 600 was shares of British
software company Micro Focus MCRO.L , which fell 5.7% on news
its executive chairman sold 11.6 million pounds of the company's
shares.
Meanwhile, Anheuser-Busch InBev ABI.BR dropped after it
pulled the planned listing of its Asia Pacific unit in Hong
Kong, Budweiser Brewing Company APAC Ltd 1876.HK , in what
would have been the world's biggest initial public offering of
2019.