By Purvi Agarwal and Ragini Mathur
Dec 8 (Reuters) – European shares were muted on Monday, with declines in consumer-facing stocks offsetting gains in industrials and healthcare stocks, while investors awaited the U.S. Federal Reserve’s monetary policy meeting this week.
The pan-European STOXX 600 was down 0.1% at 578.23 points by 0911 GMT. Major regional indexes also dipped, with those in London and Spain down 0.1% each.
Consumer staples stocks were the biggest drags on the benchmark, with Unilever down 3.7%, as per LSEG data. The consumer goods giant completed its the Magnum demerger, with the latter set to list as the Magnum Ice Cream Company.
L’Oreal fell 1.8% after the French company said it will raise its stake in Swiss skincare firm Galderma to 20%. Galderma shares were up 2.8%.
On the flip side, industrials advanced 0.2%, led by defence firms. Rheinmetall added over 2%, while the broader index climbed 0.7%.
The sector has been sensitive to headlines on progress on the Russia-Ukraine war. It logged steep declines in November as a ceasefire looked imminent but recouped some ground as uncertainty set in.
Investors also exercised some caution ahead of the Fed’s meeting this week, where the central bank is expected to lower interest rates by 25 basis points.
“We will be watching very closely how the Fed members are expecting to behave next year, whether the rate cuts are being supported by the most hawkish members,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
“We could eventually have a cautious tone, which could disappoint the market and limit appetite across the global financial markets.”
Global markets have gained in the last few weeks on rising expectations of a Fed cut in December, after dovish comments from some policymakers and delayed data pointing to weakness in the economy.
The STOXX 600 logged its second week of gains on Friday, largely driven by auto stocks, after the U.S. administration’s proposal to reduce fuel economy standards brightened their 2026 outlook, prompting upgrades from brokerages such as BofA Global Research and Citigroup.
On Monday, the sector was down 0.5%, among the biggest losers on the index. Ferrari lost 2.7% after Morgan Stanley downgraded the stock to “equal weight” from “overweight”, citing limited short- and medium-term growth prospects.
Among other stocks, Auto1 climbed 4.2% after Jefferies initiated coverage with a “buy” rating.
Renk and Bayer added 3.5% and 3.1%, after rating upgrades from Citigroup and J.P.Morgan, respectively.
(Reporting by Purvi Agarwal in Bengaluru; Editing by Janane Venkatraman and Sonia Cheema)
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