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European shares turn positive; Spain stocks rally

PARIS, Oct 2 (Reuters) - European stocks turned positive on Tuesday morning, led by rallying Spanish shares, on mounting expectation of an imminent bailout request from the debt-stricken country which would ease worries of contagion of the euro zone debt crisis.

At 0859 GMT, the FTSEurofirst 300 index of top European shares was up 0.2 percent at 1,107.14 points, after losing as much as 0.7 percent in early trade.

All eyes were on Spanish government bond yields, with the 10-year yield falling to 5.78 percent on Tuesday.

Spain's IBEX stock index was up 1 percent, with Banco Santander up 1.1 percent.

(Reporting by Blaise Robinson; Editing by Atul Prakash)

((blaise.robinson@thomsonreuters.com)(+33.1.4949.5269)(Reuters

Messaging: blaise.robinson.thomsonreuters.com@reuters.net))

Keywords: MARKETS EUROPE STOCKS/POSITIVE