2013.09.0206:52:50UTC+00European stocks soar after PMIs, Vodafone deal

European stock markets rushed upward on Monday trading action, after mostly positive PMI numbers from the region and as data from China indicates a development in that country’s manufacturing sector.

The Stoxx Europe 600 index climbed 1.5% to 301.83, removing a 0.9% decline from Friday.

Shares of Vodafone Group PLC recorded 3.4% after sources stated that the telecom firm has reached a tentative deal to sell Verizon Communications Inc. its 45% stake in their joint venture Verizon Wireless for $130 billion. Vodafone confirmed it is in advanced discussions with Verizon about the sale, but said there is no certainty an agreement will be made.

Other telecom companies were also on the development after Goldman Sachs pushed the sector higher to neutral from cautious based on recent consolidation activities. Shares of Telecom Italia SpA uptrend 5.8% and Deutsche Telekom AG bolstered 1.3%.

More broadly, investors took inspiration from Asia where most indexes closed higher on the back of upbeat Chinese data. The official Chinese manufacturing Purchasing Managers’ Index skyrocketed to 51.0 in August compared with 50.3 in July, while the HSBC PMI marched up to a final reading of 50.1 in August from 47.7 in July. A reading above 50 indicates expansion in manufacturing activity from the previous month.

Mining firms, which are sensitive to growth indications from China, posted some of the biggest gains in European trading. Shares of Rio Tinto PLC traded 3.6% higher, Anglo American PLC edged 3.8% greater, and BHP Billiton PLC shot 2.8% up.

The FTSE 100 index climbed 1.7% to 16,957.55.

In Germany, the Markit/BME manufacturing PMI spiked to 51.8 in August from 50.7 in July, marking the strongest performance since July 2011.

Meanwhile i n France, the manufacturing PMI remained unmoved in August at 49.7, coming in under the 50 mark for the 18th straight month.

The DAX 30 index leaped 1.6% to 8,231.06, while the CAC 40 index exchanged 1.6% up at 3,996.72.

Italy’s FTSE MIB index flew 1.6% to 16,947.24. Data showed growth in manufacturing output in Italy in August accelerated to the sharpest pace since April 2011.