European Markets Close Higher On Recovery Hopes

European markets ended higher on Monday, as investors picked up stocks, reacting to encouraging economic data from the euro area, the U.K., and China, and on hopes about economic recovery thanks to the rollout of coronavirus vaccines in several countries.

The new EU/UK trade deal regulations came into force over the weekend and the U.K. began the Oxford/AstraZeneca vaccine rollout, making another step in the global battle against the pandemic.

Still, worries about rising coronavirus cases limited markets' gains. Several countries in the region, including Germany, the U.K. and Scotland are said to be considering imposing tighter restrictions on movements.

The pan European Stoxx 600 advanced 0.67%. The U.K.'s FTSE 100 climbed 1.72% and France's CAC 40 moved up 0.68%, while Germany's DAX edged up 0.06%. Switzerland's SMI gained 0.33%.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Finland, Greece, Iceland, Ireland, Netherlands, Poland, Portugal, Russia, Spain, Sweden and Turkey ended with sharp to moderate gains.

Norway and Ukraine closed weak.

In the UK market, Entain Plc shares soared more than 25% after the company said an $11 billion bid proposal from US casino operator MGM Resorts significantly undervalued its business.

Fresnillo and Polymetal International surged up 10.6% and 9.3%, respectively. Anglo American, BHP Group, Glencore, Rio Tinto, Experian, Evraz, Antofagasta and Smurfit Kappa gained 4 to 6%.

Smith & Nephew, Reckitt Benckiser, Bunzl, Johnson Matthey, Ocado Group and Admiral Group also rose sharply.

In France, STMicroElectronics, ArcelorMittal, Legrand, Teleperformance, Carrefour, Saint Gobain, Engie and Orange gained 2 to 5%. Michelin, Peugeot, Publicis Groupe, Dassault Systemes, Capgemini and Technip also rose sharply.

On the other hand, Unibail Rodamco, Air France-KLM, Kering, Total, Accor and Societe Generale declined sharply.

In the German market, Wirecard spurted nearly 60%. RWE, HeidelbergCement, Merck, Covestro, Bayer, Infineon Technologies, Fresenius Medical Care, Fresenius and Deutsche Telekom gained 1 to 4%.

Lufthansa, Volkswagen, Continental, Deutsche Bank, Munich RE, SAP and Daimler ended sharply lower.

On the economic front, Eurozone manufacturing conditions improved to its highest level since May 2018 driven by stronger rises in output and new orders, final data from IHS Markit showed.

The manufacturing Purchasing Managers' Index rose to 55.2 in December from 53.8 in November, expanding for a sixth successive month. The reading was below the flash estimate of 55.5.

The UK manufacturing activity grew at the fastest pace in three years in December, final survey results from IHS Markit showed. The Chartered Institute of Procurement & Supply/IHS Markit factory Purchasing Managers' Index advanced to a 37-month high of 57.5 from 55.6 in November. The score was above the flash estimate of 57.3.

UK mortgage approvals increased to the highest level since 2007 underpinned by strong property market activity, data from the Bank of England showed. The number of mortgage approved in November increased to 104,969 from 98,338 in the previous month and was above economists' forecast of 82,500.

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