Construction and material firms help European shares to rebound

* Pan-European FTSEurofirst 300 index gains 0.3 pct

* Construction and materials sector up on M&A update

* Generali (Swiss: ASG.SW - news) gains on higher dividend expectations

By Atul Prakash

LONDON, May 27 (Reuters) - European shares rebounded from a one-week low on Wednesday, with the construction and materials sector leading the market higher after Holcim (Other OTC: HCMLF - news) and Lafarge (Paris: FR0000120537 - news) agreed with CRH (NYSE: CRH - news) on their divestment plans.

The STOXX Europe 600 Construction and Materials index rose 0.6 percent after cement firms Holcim and Lafarge said they had reached a binding agreement under which Irish firm CRH will buy some assets for 6.5 billion euro ($7.07 billion).

Shares (Berlin: DI6.BE - news) in Holcim, Lafarge and CRH rose 1.3 to 1.5 percent, helping the FTSEurofirst 300 index of top European shares to gain 0.3 percent to 1,607.39 points by 0812 GMT, after falling to a one-week low on Tuesday.

The market was also supported by a survey showing morale among German consumers improved heading into June, helped by a growing willingness to make purchases.

"The German consumer confidence survey came in higher than expected which should bode well for domestic consumption in the months ahead," Markus Huber, senior analyst at Peregrine & Black, said. "There is very little major data scheduled to be released today, keeping the focus ever more on Greece."

Greece and its European creditors sought to play down fears that Athens would default on a payment to the International Monetary Fund next week. Senior members of Prime Minister Alexis Tsipras's government have said openly that Greece does not have the money to pay 300 million euros to the IMF on June 5.

Greek shares were up 0.8 percent.

Among other sharp movers, Italy's biggest insurer Generali rose 1.2 percent after the company said it would pay cumulative dividends of more than 5 billion euros ($5.5 billion) to the end of 2018, as it focuses on increasing cash generation and building a solid capital base.

Shares in Novozymes (Other OTC: NVZMF - news) , the world's largest maker of industrial enzymes, also rose 2.2 percent after UBS (NYSEArca: FBGX - news) raised its stance on the stock to "buy" from "sell".

Energy shares were also in demand, with the STOXX Europe 600 Oil and gas index rising 0.4 percent, as oil prices rebounded on expectations that U.S. crude stocks could fall for a fourth straight week.

Europe bourses in 2015: http://link.reuters.com/pap87v

Asset performance in 2015: http://link.reuters.com/gap87v

Today's European research round-up (Editing by Hugh Lawson)