European stocks close

European stocks advanced to a six- month high, with the Stoxx Europe 600 Index extending its best start to a year since 1998, as gauges of manufacturing increased from America to the euro area to China.

The Institute for Supply Management’s U.S. manufacturing index rose to 54.1 in January from 53.1 in December, the Tempe, Arizona-based group’s data showed today. Chinese manufacturing rose last month as the world’s second-biggest economy withstood weaker exports driven by the euro-area debt crisis and a government-induced property slowdown.

Greek bondholders may get a sweetener tied to a revival in economic growth that would ease the impact of accepting a lower interest rate on new bonds, people with knowledge of the talks said.

National benchmark indexes rose in 17 of the 18 western European markets. France’s CAC 40 added 2.1 percent. The U.K.’s FTSE 100 climbed 1.9 percent and Germany’s DAX jumped 2.4 percent.

Banks and carmakers led gains.

Banco Santander SA, Spain’s biggest lender, advanced 3.6 percent to 6.16 euros. Credit Agricole SA, France’s third-largest bank, rallied 7.4 percent to 5.06 euros.

BP Plc, Europe’s second-biggest oil company, gained 2.6 percent to 483 pence.

ICAP jumped 7.7 percent to 362 pence. The world’s largest broker of inter-bank transactions said pretax profit for the year ending March 31 will be at the “upper end” of the current range of analyst estimates of 336 million pounds ($528 million) to 358 million pounds. ICAP had said in November it expected full-year profit to be within analysts’ projections at that time of 358 million pounds to 390 million pounds.

Renault SA jumped 4.9 percent to 34.18 euros. Renault- Nissan 2011 global sales rose 10 percent to a record, driven by emerging markets and the U.S., the company said.