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London - European shares got the week off to a positive start on Monday, thanks to deal-making in the telecoms sector and stimulus from China, though it was not enough to erase the losses from Friday's sharp sell-off.
In focus for markets this week will be a raft of first-quarter trading updates from European companies, which are heading for their best earnings season in four years on the back of a weak euro and improving economic conditions.
The European Central Bank's bond-buying stimulus plan has kept eurozone bond yields down and propped up appetite for equities, with NN Investment Partners reiterating in a note to clients on Monday that it was "particularly positive" about European equities.
The pan-European FTSEurofirst 300 index was up 0.8% at 12:51, still close to multi-year peaks but below where it was before Friday, when fears of a regulatory trading clampdown and turmoil linked to an outage of Bloomberg financial terminals hit financial markets.
The Frankfurt DAX index enjoyed the strongest rebound among major national blue-chip indexes, rising 1.7%. Automaker Volkswagen was one of only two German blue-chip stocks in negative territory after early comments from the Shanghai auto show pointed to slowing China demand.
Telecoms stocks including Belgacom, Deutsche Telekom and Numericable were up 2% to 3% after Liberty Global's Belgian subsidiary Telenet said it had agreed to buy local mobile network operator Base from Dutch group KPN.
"It seems pretty good for both," Michael Bishop, an analyst at RBC Capital Markets, said. "A slightly higher price for KPN than had been speculated and slightly better synergies compared to market expectations for Telenet."
As a result of taking over Base's network, Telenet will no longer need to rent capacity from Belgium's second-largest network operator, Mobistar, shares in which fell 14%.
Mining stocks also got a boost after the Chinese central bank unveiled new measures to shore up the world's second-largest economy and top consumer of metals.
Banca Popolare di Milano was up 2% after Italian daily Il Corriere della Sera reported a possible merger between the domestic Italian lender and peer Banco Popolare .
In Copenhagen, shares of jeweller Pandora rose 4.8% after the company announced e-store launches in the American market.
Oilfield services provider Petrofac fell 11.% on the London Stock Exchange after warning costs at its Laggan-Tormore project in the Shetland Islands would be higher than expected.
