By Sruthi Shankar

(Reuters) – European shares hovered near six-week highs on Monday, led by mining and luxury stocks following signs of fresh stimulus to support China's slowing economy.

The pan-European STOXX 600 index edged up 0.1% by 1000 GMT, marking gains for an eighth consecutive session.

China will adopt an "appropriately loose" monetary policy next year as part of steps to support economic growth, state media reported, citing a Politburo meeting. This marks the first such shift toward loosening since 2010.

China-exposed miners in Europe surged 2.8%, while luxury stocks LVMH and Richemont (SIX:CFR) added more than 2% each. The German DAX slipped 0.1%, despite reaching a record high earlier in the session.

"It's wording rather than action but that wording seems to be very positive from an economic perspective," said Lewis (JO:LEWJ) Grant, senior portfolio manager for global equities at Federated Hermes (NYSE:FHI).

Meanwhile, energy stocks rose 1.2%, in tandem with oil prices, after the fall of Syrian President Bashar al-Assad raised fears of instability in a region already gripped by war.

Europe's aerospace and defense index dropped 1% to a one-week low.

"It does look like, whichever way you look, there is another reason to be pessimistic, and yet markets are actually bullish. An element of it is December but in the new year, investors can find a bit of a headache when they face reality," said Federated Hermes' Grant.

Traders were looking ahead to U.S. inflation data on Wednesday to gauge the pace of the Federal Reserve's potential rate cuts, while the European Central Bank is widely expected to lower rates by 25 basis points on Thursday.

Among individual stocks, Banco BPM was flat, while its suitor UniCredit dipped 0.9% after Credit Agricole (OTC:CRARY) announced plans to raise its stake in Banco BPM.

German meal-kit company Hellofresh fell 6.7%, with traders citing a report about a U.S. probe over allegations of child labor.

CompuGroup Medical (TASE:PMCN) soared 32% after the German provider of healthcare software announced it was in advanced talks to be acquired by CVC Capital Partners (WA:CPAP) for a potential 22 euros ($23.24) per share.