(Reuters) - European shares posted their best day in six weeks on Monday, as transatlantic deals by Louis Vuitton owner LVMH and Swiss drugmaker Novartis, as well as hopes that the United States and China would seal a trade deal, boosted sentiment.
Tiffany's lower-priced rival, Denmark's Pandora A/S PNDORA.CO, gained 1%, while other luxury goods makers such as Gucci parent Kering PRTP.PA, Italian jacket maker Moncler MONC.MI and London's Burberry BRBY.L gained between 0.4% and 2.7%.
“Some companies in the retail sector have complained about softer demand, but luxury brands tend to hold up well when economies cool as the mega rich usually fare better in a cooler economic climate,” said David Madden, analyst at CMC Markets in London.
Novartis NOVN.S shares were a big boost to the STOXX 600 .STOXX index on the back of the drugmaker's $9.7 billion takeover of The Medicines Co MDCO.O, which seeks to expand its portfolio of medicines treating cardiovascular diseases.
The benchmark index bounced back from last week’s marginal loss, which had broken a run of a six straight weeks of gains, fueled largely by hopes of a trade deal.
A report that said China and the United States were very close to a “phase one” deal added to optimism from Friday, when leaders of both nations had expressed their interest in a deal.
China also said on Sunday it would seek to improve protections for intellectual property rights, a major demand of the United States in trade negotiations.
“China has appeared to relent to a degree on intellectual property, a key sticking point to the talks thus far,” said Neil Wilson, chief market analyst at Markets.com. “This could be an important step forward, but we as ever will only believe it when we see it.”
Among other stocks, Prysmian PRY.MI gained about 5% after the cable maker's troubled Western Link high voltage connection was taken over by clients, reducing further the near-term risk for the company.
In economic data, the Ifo economic institute said business morale in Germany improved in November, but indicated that manufacturing in Europe’s powerhouse was still stuck in a recession.
Reporting by Medha Singh in Bengaluru; Editing by Alex Richardson
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