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Newswire

Germany's January Sales Gain Reflects European Recovery

* Car registrations rose in Germany, France, Spain

* Increased demand follows Europe-wide rebound in 2014 (Recasts, adds analyst comment)

HAMBURG, Feb 3 (Reuters) - Passenger car registrations in Germany, Europe's largest auto market, rose about 2.5 percent in January, a source familiar with the matter told Reuters, adding to signs that a rebound in demand in 2014 has continued in much of Europe this year.

German registrations totalled around 210,000 vehicles last month, the source said on Tuesday.

Industry data released earlier this week showed that in Spain and France, January sales rose 27.5 percent and 5.9 percent respectively. In Italy, new car sales rose 10.9 percent last month.

"European auto sales are off to a strong start," analysts at Evercore ISI said in a note on Tuesday commenting on European auto sales figures.

"We believe that improving European consumer sentiment and disposable income can benefit not just European car sales but also earnings and, hence, equity prices."

European Union passenger car registrations rose 5.7 percent last year, thanks to government incentives, tax breaks and a consumer shift to cheaper brands which helped the market to return to growth following six consecutive years of declining sales. (Reporting by Jan Schwartz, writing by Edward Taylor; Editing by Georgina Prodhan)