European shares on the back foot ahead of eventful week including key Brexit vote

European shares opened in negative territory on Monday as optimism about the end of the US government shutdown faded and investors braced for an eventful week with key votes on Brexit, Sino-US trade talks and a Federal Reserve policy decision.

At 10am the pan-European STOXX 600 was down 0.3 pc with most bourses and sectors in the red as news of the second consecutive drop in Chinese industrial profits in December dampened the mood.

“Investors may want to stay cautious ahead of what is going to be a busy week with Central bank speeches, the Brexit vote in the UK Parliament and several important data releases in the U.S.” wrote ActivTrade analyst Pierre Veyret.

A number of corporate developments triggered sharp moves such as for the shares of Germany’s MorphoSys which sank 5.4pc, the worst performer on the STOXX, after a US court ruling on three patents.

Another strong loser was Alstom, which fell 2.1pc after the French group and Germany’s Siemens offered new concessions to try to satisfy antitrust concerns of the European Commission for their plans to create a joint European rail champion.

Among winners, shares of British online grocer Ocado jumped 3.7pc after a report it was in talks about a tie-up with Marks & Spencer to launch of a food delivery service. Ocado topped the FTSE 100 after hitting its highest since Sept. 6.

Mining stocks were the standout gainers, up 0.9pc, as iron ore prices in China rallied after Brazil’s mining agency ordered Vale, the world’s biggest iron ore producer, to halt operations at one of its mines.

French engineering consulting firm Altran Technologies lost ground at the open but limited losses to 1.5pc after it announced it had been the target of a cyber attack that hit operations in some European countries.

In the banking sector, Spain’s Bankia was among the few stocks making gains, rising 0.7pc after fourth-quarter earnings showed better-than-expected net interest income.

Switzerland’s CEVA Logistics CEVAL.S rose 0.5pc after it called a 1.66 billion Swiss franc bid from France’s CMA CGM too low.

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