Eurostocks post biggest gains in 15 months

LONDON (Reuters) -- European stocks posted their biggest gains in 15 months on Monday, recovering some of last week's losses as a liquidity injection from central banks soothed investor nerves, while bank stocks rallied.

Bank stocks were the leading positive influence on the European equities market. Royal Bank of Scotland, HSBC and Barclays (up $3.25 to $113.45, Charts, Fortune 500) were all among the top weighted gainers on the FTSEurofirst 300, pushing the broader European banking sector up by 2.5 percent.

The FTSEurofirst 300 index of top European shares ended unofficially 2.37 percent higher at 1,514.49 points, its largest daily percentage gain since May 23, 2006.

London's FTSE 100 index rose 3 percent, while Frankfurt's DAX gained 1.8 percent and Paris' CAC 40 added 2.2 percent.

A host of central banks pumped extra cash into the banking system last week and on Monday to stave off sudden rises in overnight lending rates, helping soothe investor concern about access to liquidity after a number of financial institutions revealed exposure to subprime market turmoil last week.

U.S. stocks rose as this extra liquidity and monthly retail sales data that beat expectations helped restore some investor confidence.