* ECM fundraising fell 25.8 pct in first quarter

* Citigroup tops global ECM league tables

* China growth worries weighs on Asia Pacific ECM

By Olivia Oran, Kylie MacLellan and Elzio Barreto

March 30 (Reuters) - A growing number of U.S. companies such as Facebook and Carlyle Group lining up to go public and a smattering of U.S. and European secondary offerings are once again giving investment bankers hope that the moribund equity capital markets may finally be waking up.

The S&P 500 has risen 12 percent in the first quarter and the market volatility tracker VIX is at five-year lows as fears about the U.S. economy and the euro zone debt crisis ease, prompting more companies to tap the public markets after being effectively shut out for the last few months.

Global equity fundraising, including IPOs and secondary offerings, tumbled 25.8 percent in the first quarter of 2012 to $150.2 billion, compared with the same period in 2011, Thomson Reuters data shows.

Global IPO proceeds, which reached $17.4 billion in 173 issues, sank to their lowest volume since the second quarter of 2009, the data shows.

Many risks to a recovery still persist, such as the impact of slowing growth in China on Asian markets, but bankers said they expect volumes at least in the United States to improve over the rest of the year.

"The IPO market had been very slow to get out of the gate in the first half of the quarter, but the last half has really been catching up," said David Hermer, head of Americas syndicate at Credit Suisse. "A number of recent landmark deals will materially change the landscape, in a positive way."

Technology deals, which captured nearly a third of all U.S. IPOs during the quarter, are expected to lead the market again, as investors pile into sectors like cloud computing, social media and mobile.

Bankers said even European companies, particularly those with a tech focus, are thinking about U.S. listings.

British vacuum technology firm Edwards, which pulled a London float last year due to choppy markets, and German high-tech lighting company Novaled this month filed with U.S. regulators for IPOs.

In a sign that the recovery might be more broad-based, companies in other sectors are beginning to test the markets as well. Private equity giant Carlyle Group, crafts retailer Michaels Stores and real estate investment trust Empire State Realty Trust are all planning IPOs.

"You're going to see more industrial companies coming out, many with higher levels of financial leverage, along with technology, energy and consumer retail," said James Palmer, New York-based managing director of equity capital markets at UBS AG. "You'll see a much broader spectrum in both the quality and type of product."

A big chunk of the activity is expected to come from private equity firms, as they look to exit investments, many of which date back to the buyout boom of 2006-2007, and sell down stakes through follow-on offerings.

"Sponsors are going to play an important role in overall capital formation," said Phil Drury, co-head of equity capital markets in the Americas at Citigroup Inc.

For banks, more activity means more underwriting fees. In the first quarter, Citigroup topped the global ranking of equity underwriters with 76 deals accounting for proceeds of $14.3 billion, up from No. 7 in the first quarter of 2011.

Goldman Sachs came in at No. 2, down from its No. 1 slot in the prior year, and JPMorgan Chase & Co took No. 3, up from its No. 5 position.

Guosen Securities, a Chinese investment bank, was the leader for global IPOs, raising $1.4 billion for clients, thanks to a number of solo deals like a $337.7 million IPO for computer knitting machine producer Ningbo Cixing Co and a $249.8 million offering for silicon maker Xi'an LONGi Silicon Materials.

"The IPO market has been slow to start, but the stars are finally starting to align," said Brian Reilly, head of U.S. equity capital markets at Barclays.

TENTATIVE RECOVERY

While the level of activity is expected to rebound from the lows seen over the last six months, bankers said the global markets are far from getting back to normal. Risks such as worries about a fragile global economy, Europe's debt problems and escalating tensions with Iran continue to add uncertainty and weigh down the markets.

Investors' concerns over a slowdown in China's economy put a damper on the Asia-Pacific market, which had dominated equity capital market issuance as the West grappled with the aftermath of the financial crisis of 2008.

"The problems are much closer to home," said Rupert Mitchell, head of equity syndication for Asia-Pacific at Citigroup. "The world is worried about China right now, where growth is going to be more measured this year."

Activity in the region tumbled 37 percent in the first quarter from a year earlier to $36.7 billion, the lowest quarterly volume since the second quarter of 2009. IPOs were down 75 percent, accounting for most of the weakness in the beginning of the year.

The major listings expected in Asia this year include the $1 billion IPO by high-end jeweler Graff Diamonds and $1.5 billion offering by Haitong Securities in Hong Kong; the $1 billion IPO by football club Manchester United in Singapore; and nearly $4 billion from two deals in Malaysia: Felda Global Ventures and healthcare company Parkway Pantai.

In Europe, German chemicals maker Evonik and insurance group Talanx and Italian aero-engine parts maker Avio are among those seen as most likely to launch their IPOs in the first half. The sale of the Russian central bank's stake in Sberbank, worth around $6 billion, could also be launched in mid-April.

But overall companies are likely to wait at least until the second half of the year before tapping the markets, bankers said.

"The market in Europe is open and investors are engaged, but every deal will be evaluated on its own merit and on a case-by-case basis," said Viswas Raghavan, global head of equity capital markets at JPMorgan.

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