European shares advanced for a fourth straight session on Monday to trade just below a 13-month high, with resource-related stocks rising on stronger crude and metals prices, while Tandberg rose on a higher bid offer.
By 1145 GMT, the FTSEurofirst 300 index of top European shares was up 0.8 percent at 1,027.65 points. A rise above 1,031 would be the highest level for the index in more than 13 months.
Commodity shares were in demand after gold hit a record high above $1,030 an ounce, platinum and palladium rose to their highest levels in more than a year and crude climbed 1.1 percent, as a slide in the dollar sparked fund buying.
Miners BHP Billiton, Anglo American, Antofagasta, Rio Tinto , Xstrata and Eurasian Natural Resources rose 1.8 to 5.5 percent.
Lonmin Plc rose 8.4 percent after the world's third biggest platinum producer said it planned to boost output by a fifth by 2013 as prices climb on shortages. But it swung to an annual loss on weak prices and lower output.
Analysts remained positive on the market's near-term outlook and said equities had potential to rise further.
"The economic data flow was mixed over the last couple of weeks, but it's not negative. I think the second half of 2009 will see fairly strong positive growth rates," said Klaus Wiener, head of research at Generali Investments.
"The equity market is also benefiting because there is a complete lack of investment alternatives. Looking at the investment opportunities you have, equities are still ranking high," he added.
Energy shares were up. BG Group, BP, Royal Dutch Shell, Tullow Oil, Repsol, Total and StatoilHydro added 0.2 to 2.1 percent.
Across Europe, Britain's FTSE 100 index, Germany's DAX and France's CAC 40 rose 0.9-1.1 percent.
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Financial stocks were among the top gainers, with Standard Chartered, HSBC, Barclays, BNP Paribas, Societe Generale and UBS rising between 0.4 percent and 2.1 percent.
The market also got some support from data showing Japan's economy grew 1.2 percent in the third quarter, nearly double the forecast and the fastest pace in more than two years.
"All of that confirms that … the market is on an uptrend, which could easily take the market another 10 to 15 percent higher till the year end. We are basically in the midst of a year-end rally," said Franz Wenzel, strategist at AXA Investment Managers in Paris.
The European index, which slumped 45 percent last year, is up 23 percent in 2009 and has surged 59 percent since hitting a record low in early March.
Among significant individual movers, Norwegian video conferencing equipment maker Tandberg rose 4.2 percent after U.S. network equipment maker Cisco raised its bid for the company, backed by holders of more than 40 percent of its shares.
Dutch copier and printer maker Oce surged 68 percent after news Japan's Canon planned to buy the company for 730 million euros ($1.09 billion).
But Swedish fashion giant Hennes & Mauritz dropped 4.1 percent after posting an unexpected 3 percent drop in sales at established stores in October, blaming the economic conditions in some of its major markets. Rival Inditex, owner of the Zara chain, dipped 0.8 percent.
Vivendi fell 2.2 percent. On Friday, the French entertainment group gained control of Brazilian telecom company GVT for up to $2.39 billion, trumping Spain's Telefonica to gain a foothold in Latin America's biggest market.
