European stocks advance as better-than- expected manufacturing in the region outweighed disappointing Chinese output data.

Commerzbankrose 6.8 per cent after the German lender said quarterly earnings increased by 25 per cent, while chief executive officer Martin Blessing prepares to leave the company.

HSBC Holdings fell 0.8 per cent as RBC Capital said that the bank’s decline in income will lead analysts to downgrade their estimates. Rio Tinto Group and BHP Billiton lost at least 1.3 per cent, dragging a gauge of miners to among the worst performers of the 19 industry groups on the Stoxx Europe 600 Index as commodity prices slid.

The Stoxx 600 climbed 0.4 per cent in late trading in London, reversing a loss of as much as 0.7 per cent.

Shares extended gains earlier as a Markit Economics release showed output in the euro area unexpectedly accelerated in October as German companies fared better than initially reported.

China’s official purchasing managers index contracted last month, missing estimates and rekindling concern about growth and demand in the world’s second-largest economy. “It’s based on the PMIs that came out this morning - some came stronger, so I think that’s the main reason for the strength,” said Guillermo Hernandez Sampere, head of trading at MPPM EK in Germany.

“It’s not all over Europe, but Germany and Italy have very positive economic data, so this will help all European markets for the time being. I think it’s a confirmation that the trend for the rest of the year is to the upside.”

The Stoxx 600 posted its best monthly rally in six years in October after Mario Draghi said the European Central Bank will consider additional easing in December, and China increased stimulus measures.

- Bloomberg