Equity investors kicked off the new month in a buying mood on Monday, lifted by speculation an EU deal over Greek debt was pending and piling into mining stocks as copper prices rose after the Chile earthquake.

Uncertainity over British politics, meanwhile, knocked sterling to its lowest level against the dollar in nine months.

World stocks as measured by MSCI were up 0.4 per cent, with emerging markets gaining 1 percent, adding to gains made in late February.

European Union Economic Affairs Commissioner Olli Rehn was  due in Athens for talks with Greek officials about the country's debt crisis.

Financial markets have been speculating that Rehn's visit, if successful, could move EU governments closer to announcing some form of emergency aid for Greece in exchange for a pledge by Athens to take fresh budget steps.

"The markets are still focused on risk right now so it will be critical to see a resolution of some of the fiscal concerns in Europe," said Macquarie Securities strategist Michael Kurtz. The pan-European FTSEurofirst 300 was up 0.9 per cent.

It was also lifted by mining stocks as copper gained 3.8 per cent on likely supply disruptions in major producer Chile.

"Mining stocks are up on the back of the earthquake in Chile, and it seems as though there's a move towards a solution in the Greek situation,  so there's a slightly more optimstic mood all around," said Richard Hunter, head of equities at Hargreaves Lansdown.

Sterling fell to a nine-month low against the dollar, hit by political uncertainty after an opinion poll showed chances of an inconclusive result in a British election due in months.

 An opinion poll published on Sunday suggested Britain's ruling Labour Party could remain the biggest party after this year's general election but without a majority in parliament, a result which investors fear could hamper decision-making and undermine a fragile UK recovery.

The pound was at $1.5148 after earlier hitting a nine-month low of $1.5096. The dollar was generally stronger, up 0.14 per cent against a basket of major currencies.

 Euro zone government bond prices were generally weaker in line with rising equities, but the spread between German and Greek debt narrowed on speculation about a deal.-Reuters