European stocks resume rally ahead of EU summit

European shares rose, resuming the two-week rally that has propelled indexes to multi-year highs, as a string of upbeat US data fuels hopes of an improvement in the global economic outlook.

Shares in European telecom gear makers rallied, with Ericsson up 2.5 percent and Alcatel-Lucent up 3 percent, after the world's largest mobile carrier China Mobile said it plans to spend $6.7 billion to develop 4G technology this year.

At 1140 GMT, the FTSEurofirst 300 index of blue chip European shares was up 0.6 percent at 1,200.98 points, surpassing an intraday high of 1,197.73 points reached last Friday, a level not seen since September 2008.

The broader STOXX Europe 600 was up 0.5 percent, hitting a near five-year high, while Germany's DAX was up 0.8 percent, reaching a level not seen since January 2008.

The euro zone's Euro STOXX 50 index was up 0.8 percent at 2,727.33 points. The blue chip index, which has been hammered by Europe's three-year sovereign debt crisis, still needs to rise about 13 percent before reaching its 2008 levels.

Japan's Nikkei average climbed 1.2 percent, snapping a two-day losing streak, as real estate companies rebounded ahead of the expected confirmation of a new leadership team for the Bank of Japan.

The Nikkei spurted in the last 30 minutes of trading to close at 12,381.19 points, after facing resistance at its five-day moving average at 12,313.67 earlier in the session. However, the index stopped short of a 54-month intraday high of 12,461 hit on Tuesday.