* FTSEurofirst 300 up 0.2 after last week's hefty falls
* Vodafone lifts telco sector; ENRC up on takeover report
* Technical indicators signal bearish trend
By Harpreet Bhal
LONDON, June 13 (Reuters) - European shares closed higher on Monday, bouncing from hefty falls in the previous week, with telecommunication stocks buoyed by gains in index heavyweight Vodafone <.VOD.L> which rose on the back of a target price hike.
The pan-European FTSEurofirst 300 index provisionally ended 0.2 percent higher at 1,091.94 points, rebounding from near-oversold conditions on its Relative Strength Index (RSI) hit on Friday, when the index shed 1.3 percent.
The index shed almost 2 percent last week in its sixth straight week of falls, partly on the back of concerns that the pace of recovery in the global economy may be slowing, and is down 2.6 percent in the year-to-date.
"The loss of momentum (in the global economy) has resulted in an oversold condition for markets and some sort of rebound was due. Given the recent pullback... the valuations look more attractive than they were a few months back," said Mike Lenhoff, chief strategist at Brewin Dolphin.
Telecommunication stocks <.SXKP> were higher, rising 0.7 percent after slipping into oversold territory below 30 on its RSI last week.
Vodafone was among the top gainers, up 0.9 percent, on the back of a target price hike broker RBS following a review of the company's recent performance and the long-term outlook.
Other gainers include Kazakh miner ENRC
Analysts also said worries about a slowing momentum in the global economy has prompted defensive stocks to gain favour on a short-term basis.
"The recent softer economic news has led to another period of sector rotation with the more defensive sectors, which had been poor performers, seeing investor demand," said Mark Burgess, chief investment officer at Threadneedle.
"(But) we do not expect a continued outperformance across the board. An improvement in economic news is likely to be a trigger in this change of sentiment."
TECHNICALS BEARISH
Further gains in equities could be short-lived, as technical indicators showed a bearish signal for equities after the 200-day moving average on the FTSEurofirst 300 <.FTEU3> inched closer towards breaking above its shorter-term 50-day moving average.
A convergence of the two indicators, known as a "death cross", point to a bearish trend on the horizon where the longer-term moving-average could become a resistance level.
JP Morgan Asset Management said equity markets have the scope to fall further, but investors should "keep the faith" and not cut their exposure as markets are starting to look cheap.
Issues such as the Greek debt situation is likely to continue to keep markets choppy. The cost to insure Greek government debt against default hit a record high as uncertainty mounted over what form any debt restructuring may take.
European policymakers appeared deadlocked on how to involve private investors in some form of restructuring of Greek debt, with German and French banks seen leaning towards contributing to a Greek rescue, even as it remained unclear how they could do so without triggering a default.[ID:nLDE75A065] (Editing by Louise Heavens)