* STOXX 600 index up 2.8 percent in February
* Investors awaiting details on Trump tax, spending plans
* Defence companies among leading gainers; miners drop
* Burberry surges as activist investor buys stake (Adds details, closing prices)
By Danilo Masoni
MILAN, Feb 28 (Reuters) - European shares edged higher on Tuesday as investors awaited U.S. President Donald Trump’s first speech to Congress for more details on his tax cuts and infrastructure spending plans.
The STOXX 600 rose 0.2 percent to snap a four-session losing streak and end February up 2.8 percent, close to a 14 month peak hit earlier in the month.
European shares have rallied more than 10 percent since Trump was elected in November as global stock markets surged in anticipation of his expansive economic policies. Investors have also cheered data confirming an economic recovery in Europe and a turn around in company earnings.
But on Tuesday investors said there were risks that Trump’s speech later in the day could disappoint, triggering a sell-off.
“This evening’s speech will have to include a convincing high level outline of tax cuts and spending increases for euphoria to be sustained,” Trevor Greetham, Head of Multi Asset at Royal London Asset Management, said in a note.
Before the speech, Trump called on Monday for a “historic” increase in military spending, fuelling sharp gains among defence and engineering stocks. A White House budget official put the potential boost to defence spending at $54 billion.
Europe’s aerospace and defence index rose 2.1 percent to its highest closing level since December 2015.
British defence and energy engineer Meggitt was the biggest gainer on the STOXX index, up 13 percent, buoyed by Trump’s remarks and a solid earnings update. The company posted a 13-percent rise in adjusted profits and raised its dividend payout.
GKN was up 4.9 percent after the British engineering group reported a 12-percent rise in adjusted pretax profit, beating market expectations, and said it would grow faster than both its main aerospace and autos markets in 2017.
Spanish builder Ferrovial, which is also exposed to the U.S. market, rose 4.3 percent after announcing results and saying that its order book last year was higher than in 2015.
Shares in Burberry rose as much as 5 percent to a 1-1/2 year high in a late-day volume spike after activist investor GBL disclosed a 3 percent stake in the luxury goods company.
Berenberg analysts said the news was a positive for Burberry shares, noting the sharp rally in Adidas after GBL disclosed a 3 percent stake in the German sportswear maker in 2015.
The European basic resources index fell 1.1 percent, the biggest sectoral decliner in Europe. It was dragged lower by losses in mining heavyweights BHP Billiton, Rio Tinto and Glencore even though these stocks recovered from their lows as metal prices turned higher, lifted by ongoing strikes in Canada and Chile.
Precious metal miner Fresnillo ended flat, outperforming the sector after reporting a more than six-fold jump in its profit for the year on higher output and a weak Mexican peso.
Elsewhere, price comparison site Moneysupermarket.com and Dutch industrial services company Aalberts Industries fell 6.1 percent and 2.4 percent following disappointing results. (Additional reporting by Atul Prakash and Vikram Subhedar; editing by Richard Lough)