UPDATE 2-European stocks muted as new lockdown outweighs strong business activity data

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markets, click LIVE/ or type LIVE/ in a news window)
* EU records strong flash PMIs, consumer confidence improves
* EU to extend vaccine export curbs
* Chip stocks jump on Intel's spending plan

(Adds comments, updates prices throughout)
By Sruthi Shankar and Shreyashi Sanyal
March 24 (Reuters) - European stocks were subdued on
Wednesday, as concerns about new lockdown measures overshadowed
a surprise return to economic growth for the euro zone in March.
After falling as much as 0.7% in earlier in the day, the
pan-European STOXX 600 index .STOXX ended flat.
Euro zone stocks .STOXXE also cut losses after IHS
Markit's flash composite PMI, seen as a good guide to economic
health, bounced above the 50 mark, separating growth from
contraction, to 52.5 this month compared with February's 48.8.
While the data gave investors some relief, a third wave of
coronavirus infections and renewed lockdown measures in Europe,
as well as a slow vaccine roll-out are likely to weigh on the
final reading of the survey and April's numbers.
"We believe this is a pause, not the end of the equity rally
yet," said Michele Morganti, an equity strategist at Generali
Insurance Asset Management.
"COVID management is a bumpy road. We nevertheless think
that recovery will be quite strong in the second half of the
year."
Another piece of data showed a flash estimate of euro zone
consumer morale improved to -10.8 this month from -14.8 in
February.
"The sharp increase in euro zone consumer confidence in
March came as a big surprise given tighter restrictions across
the bloc and ongoing difficulties with the AstraZeneca (NASDAQ:AZN) vaccine,"
said Melanie Debono, Europe economist at Capital Economics.
The European stocks benchmark has pulled away from a
one-year peak hit last week after major economies like Germany
and France imposed new lockdowns.
Meanwhile, the European Union is set to extend COVID-19
vaccine export curbs to Britain and other areas with much higher
vaccination rates, and to cover instances of companies
backloading contracted supplies, EU officials said. Among individual stocks, Italian defence and aerospace group
Leonardo LDOF.MI fell -6.1% after it postponed the initial
public offering of its U.S. electronics unit DRS DRS.N

Commerzbank CBKG.DE rose 1.6% even as Germany's No. 2
lender said it expects a net loss for 2021. Big gains for chipmakers helped limit market losses.
Shares in ASM International ASMI.AS , ASML ASML.AS and
Infineon Technologies IFXGn.DE , were up between 0.3% and 5.2%
after U.S. firm Intel Corp INTC.O announced a $20 billion plan
to expand its advanced chip manufacturing capacity. French supermarket retailer Carrefour CARR.PA rose 2.3%
after saying it had agreed to buy Brazil's third biggest food
retailer Grupo BIG in a deal that values it at $1.3 billion.