Forexpros - European stock markets were higher on Monday, after German and French leaders pledged to come up with a plan to tackle the euro zone debt crisis by the end of the month.

During European morning trade, the EURO STOXX 50 was up 0.63%, France's CAC 40 rallied 0.77%, while Germany's DAX 30 rose 0.27%.

Risk sentiment strengthened after German Chancellor Angela Merkel and French President Nicolas Sarkozy announced a joint plan to deal with the consequences of the financial crisis in the single currency bloc.

The two leaders said they would work out a plan to recapitalize European banks, come up with a sustainable answer to Greece's financial crisis and accelerate economic coordination in the euro zone by the next G20 summit, in Cannes on November 3 and 4.

The telecom sector led gains with France Telecom surging 1.06% and Alcatel-Lutent shares rising 1.00%, while Germany's Deutsche Telekom and Siemens climbed 1.10% and 0.39% respectively.

Meanwhile, European lenders were lower amid sustained concerns over debt contagion in the euro zone, after Fitch's downgraded Italian and Spanish sovereign debt on Friday.

Germany's Deutsche Bank and Commerzbank saw shares fall 0.65% and 1.01% respectively, while peripheral lenders such as Spain's Banco Santander dipped 0.54%.

French banks were mixed, with Societe Generale shedding 0.88% and BNP Paribas rising 0.58% after denying reports that they may seek to raise EUR7 billion and EUR4billion respectively as part of a Europe-wide plan.

French-Belgian lender Dexia saw shares plummet 17.24%, after agreeing to the nationalization of its Belgian banking division, following fears that it could go bankrupt.

In London, the commodity-heavy FTSE 100 rose 0.71%, tracking sharp gains in commodity prices.

Mining giants BHP Billiton and Rio Tinto saw shares climb 1.47% and 1.24% respectively, while British Petroleum jumped 1.80%.

Copper producers also contributed to gains, with Kazakhmys and Xstrata gaining 0.18% and 0.93% respectively.

Shares in the financial sector were mixed, as Lloyds Banking rose 0.35% and Barclays surged 0.75%, while the Royal Bank of Scotland saw shares decline 0.38%.

Elsewhere, U.S. equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a rise of 1.00%, S&P 500 futures signaled a 1.10% rise, while the Nasdaq 100 futures indicated a 1.10% increase.

Also Monday, official data showed that investor confidence in the euro zone fell less-than-expected in October but remained in negative territory.


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