GLOBAL MARKETS-M&A activity boosts world stocks; oil firmer

                                
* MSCI world equity index up 0.3 pct at 283.52
                                
 * Global M&A activity eases recovery concerns
                                
 * Bonds weaker; oil reverses higher
                                
 
                                
 By Natsuko Waki
                                
 LONDON, Aug 23 (Reuters) - World stocks rose from last
week's one-month low on Monday as a slew of corporate takeover
activity and an encouraging euro zone business survey helped
ease concerns about a global economic slowdown.
                                
 Mining shares gained as financial markets bet Australia's
inconclusive weekend elections would lead to a change of
government, spelling the end to a plan to impose tax on major
iron ore and coal mines.
                                
 A Markit survey showed the euro zone's economic recovery
moderated slightly this month but companies are more optimistic
about the coming months.
                                
 In the corporate sector, increasing merger and acquisition
activity is boosting investor sentiment as companies utilise
high cash balances and historically low borrowing costs to look
for bargain buys and expand their business.
                                
 HSBC <HSBA.L> is in talks to buy a stake in South Africa's
Nedbank <NEDJ.J> in a potential $6.8 billion deal. In Asia, an
estimated $58 billion worth of M&A was playing out on Monday.
                                
 Positive corporate news helped ease concerns that a renewed
spike in U.S. unemployment may drag the economy down, forcing
the Federal Reserve to implement additional monetary easing.
                                
 "The whole market is geared to M&A activity," said David
Buik, senior partner at BCG Partners. 
                                
 "We're of the opinion that the quality of economic data
across the world is poor, but on the other side of the coin
there is enough M&A activity out there to limit any kind of a
fall in the immediate future."
The MSCI world equity index <.MIWD00000PUS> rose 0.3 percent
after hitting a one-month low last week. The Thomson Reuters
global stock index <.TRXFLDGLPU> added 0.2 percent.
                                
 
                                
 M&A BOOST
                                
 The FTSEurofirst 300 index <.FTEU3> was up 0.8 percent. U.S.
stock futures were up 0.6 percent <SPc1>, pointing to a firmer
open on Wall Street later.
                                
 Markit's Eurozone Flash Services Purchasing Managers' Index,
made up of surveys of around 2,000 businesses ranging from banks
to restaurants, came in at a better-than-expected 55.6 in
August, compared with 55.8 in July. [nSLAKJE6AH]
                                
 Old Mutual <OML.L> was up nearly five percent after HSBC
said it would buy up to 70 percent of Nedbank, in which Old
Mutual has a controlling stake.
                                
 Basic resources shares were the top gainers <.SXPP>.
                                
 Foster Group <FGL.AX> closed up more than 7 percent after
sources told Reuters beverage groups SABMiller <SAB.L> and Asahi
Breweries <2502.T> were looking at the Australian brewer's beer
operations, valued at more than $10 billion. [nSGE67MO30]
                                
 Thomson Reuters data showed global mergers and acquisitions
have hit nearly $200 billion so far in August.
                                
 Emerging stocks <.MSCIEF> ticked up 0.1 percent on the day.
                                
 U.S. crude oil <CLc1> rose 0.4 percent to $74.11 a barrel,
off Friday's six-week low of $73.19. Prices had fallen more than
10 percent from an Aug 4 high of $82.97 as concerns about the
global economy darkened the outlook for energy demand.
                                
 The bund future <FGBLc1> fell 18 ticks.
                                
 
                                
 ELECTION RESULTS HIT AUSSIE
                                
 The Australian dollar briefly hit a one-month low of $0.8833
<AUD=D4> as the country faced a week of political wrangling
after Sunday's inconclusive election [ID:nSGE67L021].
                                
 The U.S. dollar <.DXY> was down around 0.1 percent against a
basket of major currencies. The yen gained 0.3 percent to 85.32
per dollar, which in turn weighed on Tokyo stocks <.N225>.
                                
 Japanese Prime Minister Naoto Kan and Bank of Japan Governor
Masaaki Shirakawa discussed the yen on Monday and agreed to work
closely, disappointing those who had expected a bolder policy
response after the yen's surge to 15-year highs beyond 85
earlier this month.
                                
 "In the absence of a further sharp appreciation of the
exchange rate towards 80 or a disorderly slide in the equity
markets, we do not anticipate any easing of monetary policy
until the scheduled policy meeting due on Sept 6-7, when we
expect a further expansion of the BOJ's funds-supplying
facility," Daiwa Capital Markets said in a note to clients.
                                
 (Additional reporting by Harpreet Bhal; Editing by John
Stonestreet)