Europe midday: M&A news, oil prices lift stocks

European stocks rebounded on Thursday afternoon as M&A news gave sentiment a boost, alongside better than expected results out of Zurich Insurance and RWE.

As of 12:30 the benchmark DJ Stoxx 600 was rising 2.69 points or 0.80% to 337.43, the Dax was higher by 90.78 points or 0.90% at 9,926.16 while Paris's Cac tacked on 39.68 points or 0.92% to 4,356.35.

Nissan unveiled a $2.2bn bid for a stake in rival Mitsubishi Motors. Closer to home, Bloomberg reported Bayer was studying tabling a $40bn offer for US rival Monsanto.

Oil shares were doing best after the International Energy Agency revised down its forecast for the excess of oil supplies this year on the back of strong demand from India and other emerging economies.

The DJ Stoxx 600 oil&gas gauge was up 1.96% at 376.98 277.31.

As expected, the Monetary Policy tweaked its guidance to reflect the possibility of a certain easing bias given the uncertainty weighing on economic activity at present.

In a clear warning, Bank of England Governor admitted the UK might be pushed into recession as the country cut many of its ties with the European Union.

The Committee said “it is more likely than not that Bank Rate will need to be higher by the end of the forecast period than at present”.

Following its previous meeting it had said: “it is more likely than not that Bank Rate will need to increase over the forecast period”.

"On the face of it, this seems to leave the door ajar to near-term easing, followed by higher rates, perhaps if Britain voted to leave the E.U. next month," Pantheon Macroeconomics said in a research report sent to clients.

Cable was little changed on the heels of the MPC meeting, off by just 0.06% to 1.4456.

Industrial production in the euro area shrank by 0.8% month-on-month in March, coming in well below the flat result expected by markets.

French consumer prices dipped at a 0.2% year-on-year rate in April following a 0.1% retreat in the month before, weighed down by falls in prices for manufactured goods. Core inflation on the other hand was steady.

As expected, Norway's central bank kept its main policy rate unchanged at 0.50%.

Dutch insurer Aegon reported a weaker than expected first quarter underlying pre-tax profit of €462m.

That came alongside a 71% drop in quarterly net income at French lender Credit Agricole.

LafargeHolcim's - the world's biggest cement maker - operating profits shrank more than expected in the first quarter following last year's merger.

Stock in Zurich Insurance Group AG jumped 6.5% after Switzerland’s top insurer cheered investors with better-than-expected profit.

German electricity outfit RWE AG rocketed 8% following its own first quarter numbers.

Euro/dollar was moderately lower by 0.32% to 1.1388 and front month Brent crude futures up by 0.937% to $48.05 per barrel on the ICE.