(Reuters) – European stocks rallied on Wednesday as a billion-dollar takeover offer for Swiss firm Sunrise Communications boosted the telecom sector and investors looked past a collapse in Britain’s quarterly economic output to bet on a stimulus-driven recovery.

The pan-European STOXX 600 closed 1.1% higher, marking its fourth consecutive day of gains and settled near a three-week high. Wall Street’s benchmark S&P 500 .SPX headed for a record high boosted by technology stocks. [.N]

Sunrise Communications (SRCG.S) surged 26.8% to a record high after U.S. firm Liberty Global (LBTYA.O) launched a takeover offer for the company in a deal valued at 6.8 billion Swiss francs ($7.40 billion).

Shares in German telecoms investor Freenet (FNTGn.DE), Sunrise’s largest shareholder, jumped 16.8%, while the broader sector .SXKP gained 1.7% to lead sectoral gains.

“Consolidation between operators would be positive for the industry as it would reduce competitive pressure on prices and improve the return on capital,” Domenico Ghilotti, an analyst at Equita wrote in a note.

Meanwhile, London’s FTSE 100 .FTSE jumped 2% as investors focused on signs of a recovery in economic output in June, shrugging off a record 20.4% plunge in the second quarter, the largest contraction reported by any major economy.

June output grew by 8.7% from May, just above economists’ average expectation in a Reuters poll for an 8% rise.

“It’s been widely expected that the UK will be in a recession. But the fact that May number was upgraded and the June number was better than expectations, is offering a little bit of encouragement,” said Russ Mould, investment director at AJ Bell.

“Markets are more interested in debating the pace of the recovery.”

Stock markets globally have rallied this week on improving data from China and Europe, signs of progress in developing a COVID-19 vaccine and expectations of fresh U.S. stimulus.

But U.S. House Speaker Nancy Pelosi said Democrats and the Trump administration remained far apart regarding any agreement over further economic aid.

Among other individual movers, Dutch bank ABN Amro (ABNd.AS) jumped 8.1% after it said its corporate bank will retreat to northwest Europe, exiting the United States, Asia, Australia and Brazil as it joins a growing list of banks restructuring their commodities business to cut risk.

European food-ordering firm Just Eat Takeaway.com NV (TKWY.AS) (JETJ.L) rose 3.2% after reporting higher revenue and underlying profit for the first half of 2020.

British online fashion retailer ASOS (ASOS.L) jumped 13.3% as it forecast full-year sales and profit significantly ahead of market expectations.

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