European stocks close

European stocks climbed the most in three weeks as a report showed Germany’s manufacturing and services industries expanded at a faster-than-expected pace.

A measure of German manufacturing compiled by Markit Economics climbed to 52 in August from 50.7 in July. The median economist estimate had called for a reading of 51.1, according to a survey. The company’s gauge of services advanced to 52.4, beating the median estimate of 51.7.

In China, a purchasing managers’ index of manufacturing from HSBC Holdings Plc and Markit rose to 50.1 in August from 47.7 in July. Economists had predicted the PMI would climb to 48.2. Readings greater than 50 mean that activity increased.

The Federal Reserve published the minutes from its July 30-31 meeting late yesterday. They showed that almost all the participants agreed with Chairman Ben S. Bernanke’s plan to start reducing bond buying later this year if the economy continues to improve in line with forecasts.

The Federal Open Market Committee continued to expect that growth will accelerate in the second half of 2013 and into 2014. After the July meeting, policy makers affirmed a pledge to continue bond buying until they see evidence that “the outlook for the labor market has improved substantially.”

National benchmark indexes declined in every western-European market today, except Greece and Iceland. Germany’s DAX added 1.4 percent, while the U.K.’s FTSE 100 gained 0.9 percent. France’s CAC 40 rose 1.1 percent.

Ahold jumped 5.2 percent to 12.86 euros. The retailer said quarterly underlying operating income gained 5.4 percent to 338 million euros ($452 million), beating the 323.8 million-euro average estimate of 10 analysts. The company said it may make acquisitions to expand into new markets.

Home Retail Group Plc, the owner of the Argos catalog chain, added 3.6 percent to 150.3 pence. Inditex SA, the world’s largest clothing retailer, rose 3.1 percent to 103.50 euros. A gauge of European retailers advanced 1.3 percent.

IMI surged 5.8 percent to 1,491 pence. The maker of air-conditioning equipment said first-half adjusted pretax profit rose 1 percent to 170 million pounds ($265 million). That exceeded the average analyst projection of 164 million pounds in a Bloomberg survey.

A gauge of banks contributed the most to the Stoxx 600’s rally as yields on 10-year Spanish and Italian bonds dropped. Banco Popular Espanol SA jumped 5.6 percent to 3.99 euros, UniCredit SpA advanced 3.7 percent to 4.57 euros and Banco Espirito Santo SA rallied 5.2 percent to 90.4 euro cents.