European stocks advanced as U.S. home prices and consumer confidence increased more than forecast, adding to signs the world’s largest economy is strengthening.

Lonza (LONN) Group AG rose 3 percent amid reports of takeover speculation. Weir Group (WEIR) Plc climbed 4.4 percent as analysts said General Electric Co. may be interested in buying the mining- equipment maker. Continental AG (CON) sank 4 percent as Schaeffler AG sold a 10.4 percent stake in the tire producer. Infineon Technologies AG (IFX) slid 6.3 percent after Europe’s second-biggest semiconductor maker forecast a decline in revenue.

The Stoxx Europe 600 Index (SXXP) added 0.4 percent to 275.82

National benchmark indexes rose in 11 of the 18 western European markets.

FTSE 100 5,863.14 +24.30 +0.42% CAC 40 3,513.64 +16.42 +0.47% DAX 7,423.66 +10.50 +0.14%  

Lonza, which produces chemicals and biotechnology products, jumped 3 percent to 51.10 Swiss francs. The Guardian and the Daily Mail reported that BASF SE and Saudi Basic Industries Corp. may be interested in buying the Swiss company, citing speculation among traders.

Weir Group climbed 4.4 percent to 1,817 pence, rising for the first time in four days. Analysts at Oriel Securities Ltd. and Investec Ltd. said GE will probably be drawn to Weir as the U.S. company looks to build its mining-equipment division through acquisitions.

Suedzucker AG (SZU) gained 3.2 percent to 28.49 euros after the world’s largest sugar producer boosted its earnings forecast for the year.

Daily Mail & General Trust Plc (DMGT) climbed 1.7 percent to 498.5 pence as the publisher of the U.K.’s Daily Mail and Mail on Sunday newspapers said full-year results will be in line with analysts’ forecasts.

A gauge of auto-industry shares dropped 1.5 percent for the biggest decline among the 19 industry groups in the Stoxx 600 as Goldman Sachs Group Inc. cut its profit estimates for Daimler AG (DAI), Volkswagen AG (VOW) and Bayerische Motoren Werke AG. (BMW)

Daimler fell 1.5 percent to 39.51 euros, VW lost 1.8 percent to 152.15 euros and BMW slid 1.4 percent to 58.79 euros.

Infineon tumbled 6.3 percent to 5.1 euros, the biggest retreat in nearly three months. The company predicted sales in the three months through December will decline as much as 10 percent from the previous quarter as clients cut spending amid the economic slowdown.

Telekom Austria AG (TKA), the phone company partly controlled by Carlos Slim’s America Movil SAB, plunged 7.2 percent to 5.70 euros, the lowest price since April 2001. The Vienna-based company cut its dividend forecast for this year to 0.05 euros a share from 0.38 euros.

Georg Fischer AG slumped 6.1 percent to 348.25 francs, its largest drop in four months. Vontobel Holding AG trimmed its recommendation on Europe’s biggest maker of iron castings for cars to reduce from buy.