By Carla Mozee, MarketWatch

Greece tells public entities to transfer cash to central bank

European stocks popped higher Monday, recovering from a selloff at the end of last week, after a China moved to drive growth in the world's second-largest economy

Greece, meanwhile, remained in focus as a deadline looms for the debt-strapped country to agree on economic reforms.

The Stoxx Europe 600 gained 0.8% to 406.87, with all sectors ending higher. Basic resources shares were the strongest performing after China's central bank over the weekend cut the amount of reserves commercial banks must hold, a move that frees up about $200 billion for lending. China has been struggling with slowing growth, including in its key property market.

Among miners, shares of iron-ore producer Anglo American rose 2.7%, Glencore PLC tacked on 1.5%, and Swedish miner and smelting company Boliden AB jumped 3.7%. Iron-ore heavyweights Rio Tinto PLC (RIO) and BHP Billiton PLC (BHP) moved up 2.5% and 2.6%, respectively.

China is a major buyer of metals and other commodities.

Most car shares also advanced Monday after the Chinese stimulus move. Shares of German car maker BMW AG rose 1.2% and Renault SA tacked on 0.4%. But Bernstein is "growing more pessimistic about industry profitability in China," as growth in that country's auto market shows signs of a rapid slowdown, it said in a note.

On Friday, the Stoxx 600 dropped 1.8% (http://www.marketwatch.com/story/european-stocks-head-lower-on-track-for-weekly-loss-2015-04-17), selling off along with other global equity markets after Chinese regulators made changes in trading rules. The changes have come as Chinese stocks have rallied.

"With the major indices so overvalued at the moment, it's no surprise they can be so easily spooked," said James Hughes, chief market analyst at eToro, in a note Monday.

On the country indexes Monday, Germany's DAX 30 jumped 1.7% to 11,891.91, and the U.K.'s FTSE 100 leapt 0.8% to 7,052.13. France's CAC 40 climbed 0.9% to 5,187.59.

Spain's IBEX 35 turned higher by 0.2% to 11,384.60. Shares of market heavyweight Banco Santander SA sloughed off losses and closed up 0.4%. The chief executive of Italy's UniCredit SpA over the weekend reportedly said the lender is getting closer to a deal under which it will combine its asset-management business with Santander's. UniCredit shares rose 3.6%.

Greece: The Greek government on Monday ordered public entities including state-owned companies and public pension funds to transfer cash reserves to the central bank (http://www.marketwatch.com/story/greece-orders-public-bodies-to-transfer-cash-to-central-bank-2015-04-20), a move that comes as Greece faces a cash crunch and a need to service debt.

Greek bond prices fell, extending losses as capital markets appear increasingly concerned Greece won't reach a deal with its lenders, which could put the country on a path to leaving the euro. As bond prices fell, the yield on 2-year Greek notes rose 2.1 percentage points to 28.4%, and the yield on 3-year debt rose 1.1 percentage points to 19.5%, according to Tradeweb data. Ten-year Greek bonds yielded 13.2%, up 58 basis points.

The Eurogroup of eurozone finance ministers will meet Friday, but few expect a major breakthrough in the debt situation. Greek Finance Minister Yanis Varoufakis (http://www.marketwatch.com/story/greeces-yaroufakis-warns-of-contagion-in-case-of-grexit-2015-04-20) on Sunday told a Spanish TV channel that "anyone who toys with the idea of cutting off bits of the eurozone hoping the rest will survive is playing with fire," Reuters reported.

"For me, the hardball tactics from the [European Central Bank and the International Monetary Fund] have been a change in stance from previous incarnations of this situation, but it is yet again the market reaction that is the most worrying for officials," wrote eToro's Hughes. A default by Greece may not necessarily lead to a so-called Grexit, but investors should "expect huge market moves," as it prices in that prospect, he said.

Read: Signs the market is girding for a Greek default, in 4 charts (http://www.marketwatch.com/story/signs-the-market-is-girding-for-a-greek-default-in-4-charts-2015-04-16)

Greek stocks turned lower, pushing the Athex Composite down 0.1% to 728.98. The Athex has dropped more than 11% this year.

Data: From the economic front, eurozone construction dropped 1.8% (http://www.marketwatch.com/story/eurozone-construction-falls-sharply-in-february-2015-04-20-54851726) in February from January, and fell 3.7% from February of last year, the European Union statistics agency said Monday.

Separately, Germany's statistics agency said producer prices rose 0.1% in March (http://www.marketwatch.com/story/german-producer-prices-edge-up-in-march-2015-04-20-24854445)from February, but on a year-over-year basis, prices fell 1.7%. Economists polled by The Wall Street Journal had projected a monthly increase of 0.2%, and a 1.6% annual decline.

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