July 3 (Bloomberg) -- European stocks gained after brokerages became more bullish on the region and Kraft Foods Inc.'s bid for Groupe Danone SA's biscuit unit fanned takeover speculation.

MAN AG advanced to an all-time high after Goldman, Sachs & Co. added shares of Europe's third-largest truckmaker to its ``conviction buy'' list. Nokia Oyj, the world's biggest maker of handsets, and German engineering company Siemens AG climbed after banks increased price estimates for the stocks. Danone rose to the highest in more than two months.

Deutsche Bank AG, Germany's biggest bank, said the Dow Jones Stoxx 600 Index will reach a record high by the end of this year as earnings growth and takeovers continue to support shares. Stocks in Europe fell yesterday after attempted terrorist attacks in the U.K. rattled investor confidence.

``The positive scenario for stocks, good corporate earnings and economic growth, is still intact,'' said Werner Wittenhagen, who helps oversee the equivalent of $21 billion at LBBW Asset Management in Stuttgart, Germany. ``Takeover speculation is still doing the rounds boosting share prices.''

Europe's Stoxx 600 added 0.9 percent to 395.71 in London as all 18 industry groups rose. The Stoxx 50 increased 0.9 percent, while the Euro Stoxx 50, a measure for the euro region, gained 1 percent.

`Bull Case'

``The long-term bull case for equities remains,'' Bernd Meyer, a strategist at Deutsche Bank, wrote in a bimonthly note to clients.

National benchmarks rose in all of the 18 western European markets except Portugal. The U.K.'s FTSE 100 gained 0.8 percent, and Germany's DAX added 1.2 percent. France's CAC 40 advanced 0.7 percent.

MAN climbed 4.1 percent to 111.75 euros. Goldman raised its price estimate for shares of the truckmaker 11 percent to 125 euros.

``The shares have further to go,'' London-based analysts including Charles Burrows wrote in a report published today. ``Earnings reports, as well as indications of continued strong demand from MAN and its peers, should provide catalysts.''

Scania AB, Sweden's second-largest truckmaker, jumped 6.9 percent to 185 kronor after Goldman lifted its price estimate for the shares 15 percent to 180 kronor.

Nokia, Siemens

Nokia added 2.2 percent to 21.39 euros. Deutsche Bank lifted its share-price forecast for the world's largest mobile-phone company by 4.8 percent to 22 euros. Second-quarter revenue will be strong on the back of increased sales of the N95 and 6300 phone models, London-based analyst Gareth Jenkins wrote in a note to investors. The stock ``remains inexpensive,'' he said.

Siemens rallied 3 percent to 109.64 euros, the highest since Sept. 20, 2000. Lehman Brothers Holdings Inc. raised its price estimate for shares of Europe's largest engineering company by 61 percent to 150 euros.

Separately, Nokia Siemens Networks, the phone-equipment venture of Nokia and Siemens, won a $900 million-order to expand the network of India's Bharti Airtel Ltd.

Business Objects SA advanced 2.3 percent to 29.72 euros. UBS AG raised its recommendation for shares of the world's biggest maker of software for tracking corporate databases to ``buy'' from ``neutral'' and increased its price estimate 12 percent to 37 euros.

`Valuation Is Appealing'

``Valuation is appealing, notwithstanding longer-term competitive concerns,'' Michael Briest, an analyst at UBS in London, wrote in a report published today.

Danone gained 1.3 percent to 61.71 euros, the highest since April 23. Kraft, the world's largest cookie maker, offered 5.3 billion euros ($7.2 billion) for the French company's LU cookie unit. Danone said in a statement that it's in exclusive talks with Kraft and an agreement may be reached by the fourth quarter of this year.

Takeovers across all industries in Europe have reached $1.36 trillion this year, compared with a record $1.6 trillion in 2006, according to data compiled by Bloomberg.

``Mergers and acquisitions will remain a big topic,'' said Petra von Kerssenbrock, an equity strategist at Commerzbank AG in Frankfurt. ``There's still a lot of liquidity in the market. Takeovers that make sense will be initiated.''

Getronics NV soared 19 percent to 6.72 euros, the most in more than three years. The largest Dutch computer-services provider was approached by an unidentified U.S. company that wants to buy all of its shares. Getronics will explore the option and the implications for the company, the Amsterdam-based company said. No financial details were released.

Heidelberger Druck, Kesa

Heidelberger Druckmaschinen AG jumped 6.5 percent to 38.54 euros after Centaurus Capital Ltd. said in a regulatory filing today that it increased its stake in the world's largest maker of printing machines to 5.1 percent.

Kesa Electricals Plc soared 7.2 percent to 337 pence. The region's third-largest consumer-electronics retailer said suitors have indicated interest in buying BUT, its French furniture and appliance chain.

TNT NV rose 1.8 percent to 34.18 euros on speculation U.S. competitor FedEx Corp. may make a bid for Europe's second-biggest express-delivery service.

A takeover by FedEx or United Parcel Service Inc. ``would make strategic sense for the companies,'' said Andre Mulder, an analyst at Kepler Equities with a ``buy'' recommendation on TNT shares, in a telephone interview today. ``I can't understand why they didn't already make a bid two years ago.''

Daphne Andriesse, a spokeswoman for TNT in Hoofddorp, Netherlands, declined to comment in a telephone interview today. A FedEx spokeswoman who declined to be identified said she couldn't immediately comment on the matter.

Greene King, SAP

Greene King Plc surged 7.9 percent to 1,036 pence, the steepest gain in the Stoxx 600 today. The U.K. pub owner that brews Old Speckled Hen said annual profit increased 21 percent on higher food sales and announced it would split off some of its property.

SAP AG fell 2.1 percent to 37.19 euros. The software company said it made ``inappropriate'' downloads of Oracle Corp. code, responding to a lawsuit that claims the German company stole programs from its competitor.

``SAP's compliance and controlling system didn't work,'' said Harald Sporleder, a fund manager at Allianz Global Investors in Frankfurt. ``It's a pity this news came in today.'' The firm manages the equivalent of $26.4 billion in stock funds for retail investors.

Oracle filed the original lawsuit in the U.S. District Court in San Francisco on March 22, claiming SAP workers hacked into a Web site and stole software code on a ``grand scale.''

Carrefour SA, Europe's largest retailer, advanced 3.1 percent to 53.09 euros. The weekly Capital reported that some members of the Halley family may want to sell the family's stake in the company. The magazine did not say where it got the information. Laurent Wormser, spokesman for the family, declined to comment on the possibility of a sale.

Vivendi SA climbed 1 percent to 31.9 euros. Frank Esser, the chief executive officer of Vivendi's mobile-phone unit, bought Vivendi shares valued at 16 million euros last month, according to a regulatory filing.

To contact the reporter on this story: Andreas Hippin in Frankfurt at ahippin@bloomberg.net.

Last Updated: July 3, 2007 12:11 EDT