So on wiktionary this as one of the definitions;

э́то • (éto)

demonstrative pronoun: this, it, that
Мне э́то нра́вится! ― Mne éto nrávitsja! ― I like it! or I like that!

So I understand this is demonstrative, which is something you can literally point at. Maybe you are getting a back massage and can say this? Maybe you are pointing at your food?

However ontop of that I just want to know how you reference a whole sentence or situations as we do in English and other languages? "I like to eat cheese at the weekends" - "Oh, I like that too". Or 10000 of other examples :P