European stock markets rallied Monday, appearing to win support from an early pre-Christmas bounce and following strong data out of the United States, traders said.

"In signs that the Santa rally might be on its way, the European markets performed remarkably well this Monday despite little actual news," said Connor Campbell, analyst at Spreadex trading group.

"The eurozone was once again the source of most of the morning's growth."

By midday, Frankfurt's DAX index was up 1.9 percent compared with Friday's close and the CAC 40 in Paris rallied 1.6 percent.

Outside the eurozone, London's benchmark FTSE 100 index won 0.5 percent.

German industrial production increased slightly in October, driven by rising activity in the manufacturing and construction sectors, the economy ministry said on Monday.

The ministry calculated that factory output increased by 0.2 percent in October compared with a month earlier, corrected for seasonal factors.

In September output had contracted by 1.1 percent.

In foreign exchange activity, the euro slid against the dollar.

Traders tracked a surge on Wall Street seen Friday after strong US jobs reading provided fresh evidence that the world's biggest economy is recovering and reinforced expectations of a December interest rate rise from the Federal Reserve.

The US Labor Department on Friday said that 211,000 jobs were created in November and the unemployment rate held at five percent.

Wall Street's three main indexes jumped more than two percent on the report.

"The market appears to have read the data as reason for confidence in the economic outlook, rather than taking flight at the prospect of imminent reduction in US Fed stimulus," said analyst Kymberly Martin at Bank of New Zealand.

While a lift in US borrowing costs would usually be expected to cause selling of equities, analysts said dealers have been soothed by indications from the Fed that any increases would be small and gradual.

With a US rate increase almost certain, the dollar pushed higher against the yen and euro. The single currency was also weighed down by comments last week from ECB chief Mario Draghi that the European Central Bank could strengthen its stimulus.

Asian stock markets mostly climbed Monday, recovering from Friday's sharp sell-off that had been fuelled by disappointment with the ECB's revised stimulus programme aimed at propping up the weak eurozone.

- Key figures around 1130 GMT -

London - FTSE 100: UP 0.5 percent at 6,266 points

Frankfurt - DAX 30: UP 1.9 percent at 10,953

Paris - CAC 40: UP 1.6 percent at 4,788

EURO STOXX 50: UP 1.6 percent at 3,385

Tokyo - Nikkei 225: UP 1.0 percent at 19,698.15 (close)

New York - Dow: UP 2.1 percent at 17,847.63 (close)

Euro/dollar: DOWN to $1.0808 from $1.0874 late in New York on Friday

Dollar/yen: UP to 123.44 yen from 123.16 yen