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* STOXX Europe 600 index up 1.2 pct
* Commodities-related stocks in demand
* Burberry slumps after update
By Atul Prakash
LONDON, Oct 18 (Reuters) - European shares bounced back onTuesday, with commodities-related stocks leading the markethigher after the prices of major metals and crude oil rose on asofter dollar.
The pan-European STOXX 600 index was up 1.2 percentby 0831 GMT after closing 0.7 percent lower in the previoussession. However, the benchmark index is still down nearly 7percent so far this year.
The market was helped by a rally of 2.4 percent in the STOXXEurope 600 Basic Resources index, the top sector gainer,as copper rose after the dollar eased from seven-month highs.Other metals, including gold, also rose as a weakerdollar made commodities cheaper for other currency holders.
The European oil and gas index also increased 1.5percent on the currency moves and comments from some analystsmarkets might not be quite as over-supplied as thought.
"The market has been trading in a sideways range for acouple of months now. However, depressed stocks and sectors haveseen some rebound, with commodities stocks falling in thatsegment," said Gerhard Schwarz, head of equity strategy atBaader Bank in Munich.
Rio Tinto, Randgold Resources, Fresnillo, Polymetal, Royal Dutch Shell,Tullow Oil and BP rose 2.1 to 3.3 percent.
Danish jeweller Pandora rose 5.7 percent, thetop gainer in the STOXX 600 index, with traders citing a bullishsurvey from Swedish broker Carnegie.
On the downside, Burberry fell 7 percent, evenafter the British luxury fashion label reported abetter-than-expected rise in second-quarter retail sales.
Traders said the stock was hit by some negative brokernotes. The group's total sales also fell 4 percent on anunderlying basis in the six months to end-Sept, hit by a fall inwholesale and licensing revenues.
"FX benefits aside, Burberry struggles to drive meaningfulgrowth," Liberum analysts said in note, adding that itsvaluation was at a premium.
Before Tuesday's fall, Burberry shares had jumped nearly 50percent since June.
French testing, inspection and certification company BureauVeritas fell 4.5 percent after the company cut itsoutlook for full year 2016 as the weakness in the oil and & gasand shipping markets weighed on its revenue. (Editing by Andrew Heavens)
