European stocks gained ground in morning trade, adding to the previous session's sharp rally in the wake of surprisingly strong U.S. monthly jobs data and on expectations the European Central Bank will start buying Italian and Spanish bonds next month to help lower the two countries' borrowing costs.

Bank of Italy Governor Ignazio Visco and Cabinet Undersecretary Antonio Catricala said on Sunday that Italy does not at the moment need to ask the euro zone's rescue funds to buy its government bonds in the markets to bring down borrowing costs.

Knight Capital Group Inc (KCG.N) looks set to enter into a $400 million financing deal with a group of investors. That will allow the trading firm to open its doors on Monday after a crippling $440 million loss, although it will come at a steep cost to shareholders, sources familiar with the situation said.

Las Vegas Sands Corp (LVS.N), controlled by billionaire Republican donor Sheldon Adelson, is the target of a federal investigation into possible violations of U.S. money-laundering laws, the Wall Street Journal reported on Saturday.

Israel's Teva Pharmaceutical Industries (TEVA.N) (TEVA.TA), the world's biggest generic drug maker, is being investigated by the U.S. securities regulator over the company's compliance with a U.S. law that prohibits bribery of foreign officials.

General Motors (GM.N) and its China joint ventures sold 199,503 vehicles in the country in July, up 15.1 percent from a year earlier, the U.S. automaker said on Monday.

ASML (ASML.AS), the global chip equipment maker, has signed up TSMC (2330.TW) to further bankroll its research and development into costly next-generation chip-making kit to make micro chips smaller, smarter and cheaper, the Dutch firm said on Sunday.

Wall Street rallied on Friday to its highest level since early May on a stronger-than-expected U.S. jobs report and renewed hope European authorities would act to contain the euro zone debt crisis.

The Dow Jones industrial average .DJI jumped 217.29 points, or 1.69 percent, to 13,096.17. The S&P 500 .SPX rose 25.99 points, or 1.90 percent, to 1,390.99. The Nasdaq Composite .IXIC added 58.13 points, or 2 percent, to 2,967.90.

(Reporting by Blaise Robinson; Editing by Susan Fenton)

• A Permanent Economic Emergency