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The
pan-European STOXX 600 index added 0.5%, steadying after
snapping two weeks of gains on Friday.
Economically-sensitive sectors including miners, financial
services and autos led the gains on Monday. Growth-oriented
technology stocks advanced 1.2%.
Focus shifts to a key inflation data from the world's biggest
economy later in the week. Global stock markets were spooked on
Friday after data showed a large increase in U.S. employment,
denting hopes that the Fed might let up in its series of rate
hikes aimed at taming surging inflation.
After ending July with gains of over 7%, the STOXX 600 has
struggled this month to extend the momentum on worries over dour
economic data, rising geopolitical tensions and fears that
higher interest rates could tip the economy into a recession.
"Lower savings by households are supporting consumer spending,
the eventual outcome could be a soft landing but the risk
remains of a slump," said Mark Haefele, chief investment officer
at UBS Global Wealth Management.
"Against this uncertain backdrop, investors should ensure a
robust portfolio that can perform in various outcomes. We prefer
defensives such as healthcare as well as quality income, and
value stocks."
Meanwhile, the European healthcare sector missed out the broader
rally, up 0.1%, after the U.S. Senate on Sunday passed a bill
intended to lower drug prices among other things.
Other defensive stocks, including European utilities and real
estate, added around 1% each.
French utility company Veolia rose 1.9% as it confirmed it would
sell Suez's UK waste business to Australia's Macquarie Group Ltd
for around 2.4 billion euros ($2.4 billion).
Siemens Energy, which supplies equipment to the power industry,
fell 2.5% as it warned of a deeper-than-previously-expected net
loss in 2022 from charges due to the restructuring of its
business in Russia.
Richemont asked shareholders to reject a candidate from Bluebell
Capital Partners as a representative of ordinary shareholders
and against the person's election to the luxury group's board at
its upcoming annual general meeting. Shares rose 0.7%.
Italian stocks lagged their European peers after global ratings
agency Moody's cut the country's outlook to "negative" from
"stable" on Friday.
(Reporting by Shreyashi Sanyal in Bengaluru; Editing by Sriraj
Kalluvila)
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