London (AFP) - Europe's main stock markets rose on Monday, fuelled by signs of solid business activity, stable eurozone inflation and optimism in Wall Street trading.
London's benchmark FTSE 100 index ended the day 0.41 percent higher at 6,865.86 points.
Frankfurt's DAX 30 rose 0.54 percent to 9,708.94 points, and the CAC 40 in Paris climbed 0.87 percent to 4,419.13 points, its highest level since September 2008.
Milan's FTSE Mib index rose 0.42 percent to 20,478 points, following a speech in the senate by new Prime Minister Matteo Renzi.
The euro was stable against the dollar at 1.3740, little changed from 1.3738 on Friday.
"We are being carried along by an overall optimism" even if not all indicators are green, Andrea Tueni of Saxo Bank said.
The fourth consecutive gain in the monthly Ifo survey of German business sentiment helped drive the rise, as did Eurostat figures showing that eurozone inflation was steady at 0.8 percent in January, easing concerns over deflationary pressure.
The inflation figure was "a bit encouraging, pending the follow-up on Friday," when provisional data for February inflation will be released, Tueni said.
US stocks were higher at midday ahead of a busy week of economic data and retail sector earnings reports.
The Dow Jones Industrial Average advanced 1.20 percent to 16,296.11 points, while the broad-based S&P 500 added 1.18 percent to 1,857.85 points. The tech-rich Nasdaq Composite Index jumped 1.08 percent to 4,309.41.
The next few days will see several major data releases, including the Conference Board's index of US consumer confidence and the second estimate of fourth-quarter economic growth.
In Europe, airlines Air France-KLM and Lufthansa did well, with the former gaining 2.84 percent to 9.55 euros per share in Amsterdam's stock market, while the German carrier climbed 2.18 percent to 18.78 euros in Frankfurt.
France's Vivendi gained 1.99 percent to 21.25 euros after confirming that its SFR mobile unit was of interest to Altice, which owns cable Internet operator Numericable. A report suggested Altice wanted to buy 50 percent of SFR in a deal that could be worth 15 billion euros.
Europacorp, the production company founded by director Luc Besson, soared 6.96 percent to 4.15 euros on weekend news that it was buying into US studio Relativity Media's American film distribution outfit as an equal partner.
Europe's biggest carmaker Volkswagen did not fare so well, losing 6.52 percent to 187.90 euros after disappointing 2013 results were released late Friday, and its announcement that it was forking out six billion euros to buy the 40 percent it does not yet own of Swedish truckmaker Scania.
Deutsche Bank added 1.32 percent to 35.70 euros after a Financial Times report that it was to slash its US unit's assets by up to a quarter, or $100 billion to comply with new financial rules on foreign banks.
Spain's Santander jumped 1.37 percent to 6.57 euros and BBVA climbed 1.93 percent to 9.072 euros in Madrid, where the IBEX 35 index showed a rise of 1.21 percent to 10,193.1 points.
British bank HSBC fared worse in London, losing 2.83 percent to 635.7 pence after announcing a lower-than-expected 15.5-percent rise in annual net profits and voicing caution over growth in emerging markets, amid weakness for the bank in Latin America.