LONDON: European shares advanced on Wednesday to a near two-week high on Wednesday, Sept 1, lifted by a manufacturing rebound in China and corporate takeover talk in the market.
Mining shares gained after China's manufacturing sector regained momentum in August, with Rio Tinto rising 1.4 percent and BHP Billiton up 2.4 percent.
Merger and acquisition talk, buoyed by several deals in the pipeline including BHP's hostile bid for Canadian group Potash Corp, also lifted the market.
Cable & Wireless Worldwide surged as much as 13 percent, with traders citing talk of bid interest from U.S. rival AT&T. The British telecoms company would not comment.
By 1042 GMT, the FTSEurofirst 300 index of leading European shares was up 1.2 percent at 1,038.16 points -- on track for its biggest one-day percentage rise since Aug. 9. The index lost 1.7 percent last month.
"China's figures overnight were quite good. They put a floor under the commodity stocks," a trader said. "We are rallying from an oversold position ... This market is looking for excuse to move higher. The amount of bid speculation this morning is enough to propel the market higher."
TUI Travel, Europe's largest travel company, climbed 5.1 percent after the Financial Times Deutschland reported majority shareholder TUI AG was considering buying the shares in the London-listed company it does not already own.
German group TUI AG gained 2.9 percent.
Strong results from Vivendi, Europe's largest telecom and entertainment group, buoyed the media sector, which gained 1.7 percent, while Vivendi rose 4.5 percent.
Across Europe, Britain's FTSE 100 rose 1.4 percent, Germany's DAX put on 1 percent and France's CAC 40 added 1.8 percent. The Thomson Reuters Peripheral Eurozone Countries Index gained 2.1 percent.
The U.S. private sector ADP National Employment report, due at 1215 GMT and a precursor to Friday's non-farm payrolls data, will be closely watched. Economists in a Reuters survey expected 19,000 jobs were created in last month, versus the 42,000 jobs created in July.
The U.S. ISM data was also due out later in the day.
"In the short term, the market will be volatile because as long as the data remains soft, it is a headwind. We may get some more weak data point from the U.S. We have the ISM today, which is likely to be down from last month," said Ronan Carr, European equity strategist at Morgan Stanley.
"The income data from the U.S. is (also) a headwind but ultimately we think it is just a mid-cycle pause that you often see in this stage of the cycle. There is no double dip."
In terms of valuations, the STOXX Europe 600 index carried a one-year forward price-to-earnings of 9.96, versus its 10-year average of 13.68, Thomson Reuters Datastream showed. The U.S. S&P 500 had a one-year forward P/E of 11.55. - Reuters
Mining shares gained after China's manufacturing sector regained momentum in August, with Rio Tinto rising 1.4 percent and BHP Billiton up 2.4 percent.
Merger and acquisition talk, buoyed by several deals in the pipeline including BHP's hostile bid for Canadian group Potash Corp, also lifted the market.
Cable & Wireless Worldwide surged as much as 13 percent, with traders citing talk of bid interest from U.S. rival AT&T. The British telecoms company would not comment.
By 1042 GMT, the FTSEurofirst 300 index of leading European shares was up 1.2 percent at 1,038.16 points -- on track for its biggest one-day percentage rise since Aug. 9. The index lost 1.7 percent last month.
"China's figures overnight were quite good. They put a floor under the commodity stocks," a trader said. "We are rallying from an oversold position ... This market is looking for excuse to move higher. The amount of bid speculation this morning is enough to propel the market higher."
TUI Travel, Europe's largest travel company, climbed 5.1 percent after the Financial Times Deutschland reported majority shareholder TUI AG was considering buying the shares in the London-listed company it does not already own.
German group TUI AG gained 2.9 percent.
Strong results from Vivendi, Europe's largest telecom and entertainment group, buoyed the media sector, which gained 1.7 percent, while Vivendi rose 4.5 percent.
Across Europe, Britain's FTSE 100 rose 1.4 percent, Germany's DAX put on 1 percent and France's CAC 40 added 1.8 percent. The Thomson Reuters Peripheral Eurozone Countries Index gained 2.1 percent.
The U.S. private sector ADP National Employment report, due at 1215 GMT and a precursor to Friday's non-farm payrolls data, will be closely watched. Economists in a Reuters survey expected 19,000 jobs were created in last month, versus the 42,000 jobs created in July.
The U.S. ISM data was also due out later in the day.
"In the short term, the market will be volatile because as long as the data remains soft, it is a headwind. We may get some more weak data point from the U.S. We have the ISM today, which is likely to be down from last month," said Ronan Carr, European equity strategist at Morgan Stanley.
"The income data from the U.S. is (also) a headwind but ultimately we think it is just a mid-cycle pause that you often see in this stage of the cycle. There is no double dip."
In terms of valuations, the STOXX Europe 600 index carried a one-year forward price-to-earnings of 9.96, versus its 10-year average of 13.68, Thomson Reuters Datastream showed. The U.S. S&P 500 had a one-year forward P/E of 11.55. - Reuters
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