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By Bloomberg

European stocks rebounded after the biggest weekly decline this year as manufacturing increased more than earlier estimated, easing concern deflation will deepen. German and French bonds fell, while the dollar strengthened and Chinese shares climbed.

The Stoxx Europe 600 Index advanced 0.7 percent at 8:26 a.m. in New York. Standard & Poor’s 500 Index futures gained 0.3 percent. The Bloomberg Dollar Spot Index increased 0.2 percent while the euro slipped against all 16 major peers. The yield on 10-year German notes jumped two basis points from Thursday to 0.39 percent and France’s rose to 0.67 percent. The Shanghai Composite Index advanced 0.9 percent on stimulus speculation. Oil in New York added 0.5 percent to $59.47 a barrel.

Manufacturers in the euro area raised prices for the first time in eight months in April, according to Markit Economics on Monday, before U.S. data that will probably indicate factory orders increased the most since July. Stocks fell last week as the Federal Reserve left open the possibility of raising interest rates, and bond yields climbed from Italy to Spain amid signs the European Central Bank asset purchases may be helping to quell slowing inflation.

“Last week’s correction provided a good entry point for a lot of investors,” Alessandro Bee, a strategist at Bank J Safra Sarasin, said by phone from Zurich. “Liquidity is still being poured into markets and the European economy is accelerating. The next step is to understand whether U.S. growth is really slowing, or whether we’ll get a much-needed recovery in the second quarter.”

Light Trading

The Stoxx 600 slid 3.4 percent last week, the most since December, ending at its lowest level since March on April 30, the last day of trading before most most European markets closed for a holiday. Trading volumes in the Stoxx 600 were 30 percent below the 30-day average on Monday, with London trading closed, according to data compiled by Bloomberg.

Syngenta AG jumped 7.8 percent after people familiar with the matter said Monsanto Co. approached the Swiss maker of crop chemicals about a takeover. That pushed a gauge of chemicals companies up 1 percent, the most among 19 industry groups.

Greece’s ASE Index slipped 0.4 percent after posting the biggest advance among western-European markets in April.

Gaps remain between Greece and its creditors on issues ranging from fiscal forecasts to labor and pension reforms, three days before the ECB’s next decision on emergency aid to Greece, three people familiar with the talks said. Still, progress has been made in an improved atmosphere and Greece should have the cash to make a 200-million-euro ($223 million) payment to the International Monetary Fund this week, officials said.

Factory Orders

S&P 500 E-mini futures expiring in June rose after the index slipped 0.4 percent last week. U.S. factory orders probably jumped 2 percent in March, according to the median of 47 estimates in a Bloomberg survey of economists. Treasuries were little changed, with the 10-year yield at 2.12 percent.

Comcast Corp. rose 1.4 percent after the cable provider’s profit exceeded estimates. About 73 percent of the 361 S&P 500 companies that have reported earnings this season have beaten analysts’ profit projections, while 48 percent topped sales predictions.

The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong increased 0.2 percent. The Shanghai property index headed toward a record high as Soufun Holdings Ltd. data showed home prices climbed in Beijing and Shanghai.

China Manufacturing

China’s final Purchasing Managers’ Index for April was at 48.9, missing analysts’ estimates and signaling a contraction, HSBC Holdings Plc and Markit Economics said Monday.

India’s Sensex rebounded from a three-month low as Maruti Suzuki India Ltd., the nation’s largest carmaker, climbed after reporting an increase in April sales.

Saudi stocks traded near a six-month high before regulators release details on rules that would open the market to foreigners. Investors outside the six-nation Gulf Cooperation Council now access shares listed on the country’s $572 billion market through equity swaps and exchange-traded funds.

Euro-area bonds handed investors a loss of 1.4 percent in April, according to the Bloomberg Eurozone Sovereign Bond Index, ending 15 consecutive months of gains.

Average selling prices in the euro area rose in April, reflecting increases in Germany, Italy and Ireland, London-based Markit Economics said on Monday. A Purchasing Managers Index for manufacturers was at 52 in April, compared with an April 23 estimate of 51.9 and down from 52.2 in March. A reading above 50 signals expansion.