The continent-wide STOXX 600 index was under 0.7% at 0857 GMT, worsening losses from earlier in the session.
The index published its first weekly decline in eight last week as worries of an impending global recession because of aggressive rate hikes from major central banks countered optimism around loosening strict coronavirus curbs in China.
The next days will be a significant test for markets pinning their hopes on central banks scaling back the speed and size of rate hikes, though the power in U.S. economic data last week cooled some of those anticipations.
With current signs of easing inflationary pressures in the eurozone, the ECB should deliver a dialed-down 50 basis points (bps) rate hike on Dec. 15, a day after the Federal Reserve’s interest rate information.
The Situation Is Quite Mixed
According to Russ Mould, investment director at A.J. Bell, the markets are still counting on this narrative that inflation will cool, the central banks will be able to slow down, and linger interest rate increases.
But the numbers remain diverse, so it’s not quite as precise cut as the markets would like it to be.
With streaming coronavirus cases in China spurring concerns about disrupting the country’s economic activity, industrials and some China-exposed luxury firms such as LVMH and Kering (EPA: PRTP) S.A. were among the largest drags on the STOXX 600.
Shares of the London Stock Exchange increased 3.9% following Microsoft (NASDAQ: MSFT) agreed to purchase an equity stake of nearly 4% in the U.K. bourse operator as part of a broader deal to relocate its data to the cloud.
Sanofi (NASDAQ: SNY) S.A. rose 0.7% behind the French drugmaker on Sunday, expressing it pulled out of talks to buy Horizon Therapeutics (NASDAQ: HZNP).
