Stocks: Monday’s review

European stocks rose to the highest in eight weeks as investors bet central banks will add to measures unveiled by the region’s governments to contain the sovereign-debt crisis and data from China and Japan fueled optimism Asia will drive global growth.

In China, the government’s Purchasing Managers’ Index fell to 50.2 in June from 50.4 in May, the Beijing-based National Bureau of Statistics and China Federation of Logistics and Purchasing reported yesterday. That beat the 49.9 median estimate in survey of 24 economists.

A separate PMI, compiled by HSBC Holdings Plc and Market Economics, posted a final reading of 48.2 in June compared with 48.4 in May, according to figures released today.

In Japan, large manufacturers became less pessimistic as declines in commodity prices aided profitability, boosting the outlook for the world’s third-biggest economy.

The quarterly Tankan index of sentiment was minus 1 in June from minus 4 in March, the Bank of Japan said today in Tokyo.

National benchmark indexes advanced in all of the 18 western European markets except Iceland. France’s CAC 40 climbed 1 percent and the U.K.’s FTSE 100 added 1.1 percent. Germany’s DAX increased 1.1 percent.

Invensys, which makes software that runs the London Underground trains, gained 1.7 percent to 226.5 pence. China South Locomotive is in the early stages of planning a possible 2 billion-pound ($3.14 billion) takeover bid for the company, the Sunday Times reported, without saying where it got the information.

Aviva advanced 3.7 percent to 282.6 pence. John McFarlane is taking over the position of chairman from Colin M. Sharman, who is retiring, the company said.

Most U.S. stocks rose, sending the Standard & Poor’s 500 Index to an almost two-month high, as takeovers helped the market recover from earlier losses triggered by data showing a contraction in manufacturing.

About two stocks rose for each that fell on U.S. exchanges today. Earlier losses came as the Institute for Supply Management’s manufacturing index declined to 49.7 in June, worse than the most-pessimistic forecast. Figures less than 50 signal contraction. Separate data showed euro-area manufacturing output contracted for an 11th straight month, while Chinese manufacturing indexes slipped to seven- month lows.

The Morgan Stanley Cyclical Index of companies most-tied to the economy dropped 0.5 percent, trimming a decline of as much as 1.5 percent. JPMorgan Chase & Co. (JPM) rallied 1.5 percent to $36.28. Caterpillar Inc. (CAT), the world’s largest maker of construction equipment, retreated 1.5 percent to $83.68.

Micron Technology jumped 3.8 percent to $6.55. The company agreed to buy bankrupt Japanese chipmaker Elpida in a transaction valued at 200 billion yen ($2.5 billion), gaining memory chip-making assets that may help it avert price swings that fueled four straight quarters of losses.

Amylin Pharmaceuticals climbed 8.9 percent to $30.71. The agreement is the second announced this year for Bristol, and the largest for the industry. It comes after the blood-thinner Plavix, Bristol’s top seller in 2011 at $7.1 billion, faced generic competition for the first time in May.