By Sarah Turner
European shares ended higher Monday as investors welcomed improved manufacturing-activity data.
At the regional level, the French CAC-40 Index rose 0.9% to 3639.46, the U.K.'s FTSE 100 Index rose 1% to 5096.25 and the German DAX Index rose 0.3% to 5430.82.
The pan-European Dow Jones Stoxx 600 Index rose 0.3% to 237.64 after the U.S. Institute for Supply Management reported that its manufacturing index jumped to 55.7% in October from 52.6% in September. Similar gauges in the euro area and the U.K. also showed improving conditions in manufacturing.
Companies in the metals and construction sectors advanced on the data. Salzgitter /zigman2/quotes/203507352/delayed DE:SZG -4.11% rose 1.6%, and French construction materials firm Saint Gobain /zigman2/quotes/201813666/delayed FR:SGO -0.97% added 3%.
However, Royal Bank of Scotland came under selling pressure after the lender said it's going to have sell off assets "not initially contemplated" as a result of negotiations with the European Commission. Shares fell 7.8%.
"With more banking recapitalization imminent, we think this will exert pressure on weaker banks," said equity strategists at ING. Among other financials, Dexia shares lost 3.5%.
Telecom carriers traded higher, with BT Group up 2% and France Telecom up 1.7%. Vodafone Group /zigman2/quotes/202484985/delayed UK:VOD +3.72% added 1.2%.
Elsewhere, Ryanair shares gave up 1.6%. The Irish budget airline's Chief Executive Michael O'Leary said in an interview that management changes at Boeing /zigman2/quotes/208579720/composite BA +0.92% are distracting executives and threatening a big potential jetliner order from Ryanair.
Peugeot rallied 4.2%, helped by data showing French car sales climbed 20% in October and news that parts maker Faurecia will buy exhaust-control specialists Emcon Technologies in an all-share deal, diluting Peugeot's stake in Faurecia. Faurecia shares rose 6.7%.
Oil and gas exploration and development firm Dragon Oil jumped 8.9% in London after agreeing to a full takeover by Emirates National Oil Company, which already holds 51.5% of the firm.
"Many shareholders would be happy to accept 455 pence a share for their stake, and given that another bidder is not likely to emerge, the offer is likely to go through, in our view," said analysts at Bank of America's Merrill Lynch unit.
Overseas, U.S. stocks were higher, led by materials and financial shares, after solid reports on home sales, construction spending and manufacturing.
Most Asian markets ended lower, with Japanese exporters such as Sony hurt by concerns over the U.S. economy and the yen's recent strength. But stocks in Shanghai jumped sharply after data showed China's manufacturing activity accelerated at its fastest pace in 18 months. The Shanghai Composite Index gained 2.7% to 3076.65, helping Hong Kong's Hang Seng Index narrow sharp early losses and end 0.6% lower at 21620.19. Japan's Nikkei 225 Average ended down 2.3% at 9802.95.
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