Europe open: Stocks start higher with US markets closed for holiday

Europe's main equity benchmarks began the session moving higher with sentiment boosted by a renewed interest in mega mergers and acquisitions, despite news over the weekend that US giant Kraft-Heinz had decided to withdraw its bid for Unilever.

As of 0820 GMT the benchmark Stoxx 600 was ahead by 0.36% to 371.57, the Dax was gaining 0.63% to 11,830.91 and the Cac-40 by 0.59% to 4,896.42.

Milan's FTSE Mib was rising 0.67% to 19,133.81.

"Despite failed bids and increased political risks, equity markets are back on their rising trajectory, with the financial and materials sectors leading the way as global markets resume their march higher. Although the Kraft Heinz deal for Unilever met a very quick end, the market has been quick to embrace the wider possibility of future potential mergers and acquisitions, which is giving equity markets a boost," said Rebecca O'Keefe, head of investment at Interactive Investor.

In parallel, front month Brent crude oil futures were up by 0.45% to $56.06 per barrel on the ICE while euro/dollar was edging higher by 0.11% at 1.0619.

To take note of, US markets were to remain closed on Monday in observance of President's Day, meaning that trading volumes were likely to be depleted as a result of many traders being away from their desks.

German producer prices were up by 0.7% month-on-month in January - the most in almost five years - and 2.4% higher versus the year-ago period, according to the Federal Office of Statistics.

Still to come on the economic calendar, the European Commission was scheduled to publish its latest estimate of euro area consumer confidence for the month of February.

In the corporate space, stock in Unilever was trading roughly 8% below Friday´s closing level after US rival Kraft Heinz pulled its hostile bid for the consumer goods manufacturer in the face of its negative response to the approach.

Unilever's negative reaction made a deal on friendly terms impossible, leaving Chicago-based Kraft with no option but to withdraw, people with knowledge of the situation told Bloomberg.

Softbank was willing to cede control of Sprint to Deutsche Telekom's T-Mobile in order to facilitate a tie-up between the two, according to Reuters.

America's Peter Schoenfeld Asset Management, which holds a stake in E.On, joined hedge fund Knight Vinke in caling for E.On to split-up into separate units.