By Aude Lagorce, MarketWatch
LONDON (MarketWatch) — European stocks rose on Monday as some clarity on China’s economic policy helped reassure investors about growth prospects, and as several deals were announced.
The Stoxx Europe 600 index (ST:STOXX600 277.65, +1.46, +0.53%) gained 0.3% to 277.06.
The benchmark rose for five consecutive sessions last week — adding 1.9% — and closed at its highest level in more than two years on Friday.
Among the major indexes, France’s CAC 40 (FR:PX1 3,888, +30.47, +0.79%) added 0.4% to 3,873.81, Germany’s DAX 30 (DX:DAX 7,031, +24.63, +0.35%) gained 0.3% to 7,026.86 and the U.K.’s FTSE 100 (UK:UKX 5,856, +43.36, +0.75%) climbed 0.6% to 5,844.72.
Shares rallied in Asia overnight after the Chinese central bank did not hike its benchmark interest rate despite a surge in monthly inflation. See story on China’s inaction on rates.
The move came as a relief to European investors who have been concerned that a tightening of monetary policy in China, one of the world’s biggest growth engines, could stifle the global economic recovery.
On Monday, European shares once again rallied behind the banking and mining sectors.
Shares of Royal Bank of Scotland Group (UK:RBS 42.34, +0.65, +1.56%) rose 0.8% in London and Credit Agricole SA (FR:ACA 10.68, +0.16, +1.47%) gained 1% in Paris.
Among miners, shares of Kazakhmys PLC (UK:KAZ 1,570, +41.00, +2.68%) rose 2.2% and AngloAmerican PLC (UK:AAL 3,069, +41.50, +1.37%) added 1.6%.
Gains in the regio were also fueled by a number of deals.
Shares in Wellstream Holdings PLC (UK:WSM 784.50, +37.50, +5.02%) surged 5% after General Electric Co. (GE 17.72, +0.59, +3.44%) said it will acquire the British oil-services company for 800 million pounds ($1.3 billion).
Wellstream shareholders will receive 786 pence a share, including a 6 pence cash dividend, GE said in a statement.
In the consumer-products sector, Reckitt Benckiser Group PLC (UK:RB. 3,574, +65.00, +1.85%) said it’s agreed to buy Indian, over-the-counter pharmaceutical firm Paras Pharmaceuticals for around £460 million.
Shares of Reckitt rose 1.1% in London.
In Sweden, lock manufacturer Assa Abloy AB said it’s struck an agreement to buy a 63.6% stake in industrial door and locks system group Cardo AB (SE:CARD 418.00, +135.00, +47.70%) for roughly 11.3 billion Swedish krona ($1.6 billion.)
The offer sent Cardo shares up nearly 48%.
Some broker notes also triggered significant share moves.
Rhodia SA (FR:RHA 22.45, +1.15, +5.38%) gained 4% after Credit Suisse initiated the chemicals company at outperform.
