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Europe ends mostly higher as oil recovers; Italian banks rally

European markets ended mostly higher on Monday as a recovery in oil prices and a rally in Italian banks boosted investor sentiment.

The pan-European STOXX 600 came off session highs to finish trade up some 0.3 percent provisionally, with most sectors closing in positive territory.

London's FTSE 100 closed some 0.1 percent down, while its European counterparts pushed higher. France's CAC ended up 0.2 percent and Germany's DAX jumped some 0.6 percent.

Commodities accelerate

Symbol
Name
Price
 
Change
%Change
Volume
FTSE
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DAX
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CAC
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IBEX 35
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Oil prices — which were down over 1 percent in earlier trade — pared their losses to trade higher in afternoon trade, with Brent and U.S. crude up over 1.5 percent each, around $42.78 and $40.40 respectively at Europe's close.

The price of oil is expected to move back and forth during this week's trading sessions, ahead of a meeting between leading oil producers due to take place this weekend in Doha. Stocks finished mostly higher in the sector, with Royal Dutch Shell and Sbm Offshore posting solid gains.

Basic Resources was one of Europe's top-performing sectors Monday, closing up some 3.1 percent overall, as several metal prices ticked higher. A weaker U.S. dollar helped drive the rally in markets as commodities became cheaper to purchase.

Anglo American and ArcelorMittal saw shares posting gains of above 6.5 percent. Precious metals firm Fresnillo jumped 3 percent, as spot silver prices ticked sharply higher.

Italian banks rally, Tech in focus

Vivendi agreed on Friday to take a 3.5 percent stake in Mediaset, Italy's largest private broadcaster owned by former Italian Prime Minister Silvio Berlusconi. Shares of Mediaset closed above 2 percent, while Vivendi ended slightly lower.

The Italian banks were trading higher after a report that the country's largest lenders will meet the Treasury and central bank to form a plan to set up a state-backed fund that will buy the bad loans held by these banks. Shares of Banco Popolare closed up 10.3 percent while Banca Monte dei Paschi di Siena and Banca Popolare di Milano both finished up 6 percent or more.

Meanwhile, shares of SAP wavered during trade, finishing slightly lower, after the software firm warned late on Friday that its first-quarter results would be weaker than expected. This dragged down the STOXX 600 technology sector, which was one of the only sectors to close in the red.

Also weighing on the sector was the slide in the share price of Gemalto — off 3 percent — after Credit Suisse cut its price target for the stock and put an "underperform" rating on the stock. The chipmakers including ARM and Dialog Semiconductor both ended more than 1 percent lower.

Elsewhere, food and beverage firm Nestle fell near the bottom of Europe's benchmarks, slipping some 3.4 to 3.5 percent, as its shares went ex-dividend.

Daily Mail's parent is in talks with private equity firms for a possible bid for Yahoo. A DailyMail.com spokesman told CNBC on Monday that while discussions were at a "very early stage", there was no certainty that any transaction would take place. Shares in Daily Mail and General Trust closed down 0.6 percent on Monday.

China CPI data

Asia markets closed mixed on Monday, with Japanese shares ending lower and Chinese markets closing in positive territory.

Before Asia's market open, China released its March inflation data. The consumer price index (CPI) rose 2.3 percent on-year in March, compared with a 2.5 percent forecast by a Reuters poll and in line with February's 2.3 percent on-year reading. Analysts said the inflation reading wasn't likely to affect expectations for further monetary easing from the mainland's policy makers.

Overseas in the U.S., markets traded higher as investors awaited the beginning of earnings season.

- Saheli Roy Choudhury contributed to this report.

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