European markets close lower as investors look ahead to Fed, ECB meeting

The pan-European Stoxx 600 fell 0.4% as investors prepared for monetary policy announcements from the U.S. on Wednesday and the European Central Bank and Bank of England Thursday.

France's CAC 40, the U.K.'s FTSE 100 and Germany's DAX all shed around 0.4%. All sectors were in the red bar oil and gas, which rose 0.3%. Mining stocks led losses, down 1.6%.

Markets expect both Europe and the U.K. to slow the pace of rate rises to 50 basis points.

Last week, the Stoxx 600 index posted its first weekly drop for eight weeks.

— Jenni Reid

Biotech firm Chr. Hansen remained the top performer among Stoxx 600 stocks in late afternoon trade on news of its merger with Novozymes.

The company was up 19.2%, as its new partner plunged 15.3%. Analysts at Jeffries said the deal will see Novozymes pay a 49% premium to Chr. Hansen.

Germany's Carl Zeiss Meditec added 5% after announcing it would hike its dividend from 0.90 euros to 1.10 euros in March.

But markets were generally downbeat, with mining stocks shedding 1.7%, retail stocks falling 1.3% and technology down 1.1%.

— Jenni Reid

U.S. stocks opened higher Monday morning, ahead of a week with several highly-anticipated events in the ongoing fight against inflation.

The Dow Jones Industrial Average added 76 points, or 0.2%. The S&P 500 gained 0.2% and the Nasdaq Composite added 0.1%.

— Tanaya Macheel

Mark Jones, deputy CEO of Man Group, discusses the outlook for markets in 2023 in the context of what the U.S. Federal Reserve might do.

Shares of Danish biotech companies Novozymes and Chr. Hansen were the biggest movers on Monday orning after they announced plans to merge.

Novozymes shares fell 15% by mid-afternoon while Chr. Hansen shares soared 18%.

- Elliot Smith

Vincent Clerc, incoming CEO of the Danish freight giant, says "after two years of bumper profits and supply chain disruptions because of the pandemic, we have a different set of circumstances."

U.S. tech giant Microsoft on Monday announced a 10-year partnership with the London Stock Exchange Group and took a near 4% stake in the U.K. bourse operator.

The partnership involves next-generation data and analytics, as well as cloud infrastructure solutions, according to a statement by the LSEG. It involves a new data infrastructure for the London exchange and analytics and modelling solutions with Microsoft Azure, AI, and Microsoft Teams.

Read the full story here.

- Matt Clinch

Shares of Danish biotech companies Novozymes and Chr. Hansen were the biggest movers on Monday orning after they announced plans to merge.

Novozymes shares fell 13% in early trade while Chr. Hansen shares soared 22%.

- Elliot Smith

Biotechnology firms Novozymes and Chr. Hansen agreed to combine in what will be the biggest-ever merger between two Danish companies.

The merger, announced in a joint statement Monday, will see the dissolution of Chr. Hansen and is expected to complete in the fourth quarter of 2023.

The new biosolutions group will have annual revenues of approximately 3.5 billion euros ($3.7 billion), the companies said.

Read the full story here.

- Elliot Smith

The U.K. economy grew by 0.5% month-on-month in October, slightly ahead of a Reuters poll projecting a 0.4% rebound from September's 0.6% contraction.

The previous month's figures were affected by a one-off public holiday to mark the funeral of Queen Elizabeth II.

The Bank of England projects that the economy is already in a recession that could endure throughout 2023.

Jeremy Batstone-Carr, European Strategist at Raymond James, said Monday's figures from the Office for National Statistics "flatter to deceive, concealing an otherwise-shrinking economy."

"Government spending, residential investment, and a boost from net trade have sugar coated GDP in Q3, but that coating is now dissolving as the housing market and global economy weakens," Batstone-Carr said.

"The economy is no longer teetering on the edge of recession; it is fully in one. We are now feeling the pain of both relentless inflation and interest rate rises, which are both crippling business and household spending. The Bank of England's Monetary Policy Committee is divided on how sharply to rise base rates, but it looks increasingly likely we will be living with another 0.5% increase by the end of this week."

Shares in a little-known London-listed miner are set to rise by 50%, according to Ben Davis, a mining analyst at Liberum Capital.

The company, which extracts metals such as platinum, palladium, and chrome, also offers an 8% dividend yield.

CNBC Pro subscribers can read more here.

— Ganesh Rao

Dan Niles' Satori Fund is beating the market this year. He shares what's behind the outperformance and how he's trading the market as recession looms.

Pro subscribers can read more here.

— Zavier Ong

European markets are expected to open in negative territory Tuesday.

The U.K.'s FTSE 100 index is expected to open 17 points lower at 8,393, Germany's DAX down 18 points at 18,718, France's CAC 5 points lower at 8,199 and Italy's FTSE MIB down 31 points at 34,451, according to data from IG.

Earnings are due from Euronext, Eutelsat, Hannover Re, Bayer, Porsche and Vodafone.

— Holly Ellyatt