High Chinese exports still a headwind to European steel, JPM says

** J.P.Morgan says record Chinese exports will likely weigh on European steel equities that are up 7% since March due to an upturn in global manufacturing PMIs

** China steel exports increased by around 30% in Q1 from a year earlier as domestic demand was weak, the broker says

** It expects EMEA mining equities to have a broader exposure to global PMI rebounds in Q2, with Anglo American AAL, Rio Tinto RIO and Norsk Hydro NHY as top picks

** JPM cuts SSAB SSAB_A to "neutral" from "overweight", estimating the Swedish steelmaker's investment at fossil-free Lulea minimill renders its balance sheet FCF negative in the medium term, while weaker demand in the U.S. can drive near-term earnings downgrades

** It lowers Spain's Acerinox ACX to "underweight" from "overweight", as it expects tight EU stainless supply following a strike in Cadiz factory and rising import pressures from countries such as Taiwan and Turkey

** It also downgrades Austria's Voestalpine VOE to "underweight" from "neutral" due to its large exposure to auto customers that puts it at risk from weaker demand or prices