FX.co ★ European Shares Edge Lower Before Year-end

European stocks declined during Monday's cautious trading session, following a downturn in all three major U.S. market indices on Friday. This downturn effectively interrupted the anticipated "Santa Claus rally" due to apprehensions about escalating bond yields.

As traders prepared for the upcoming New Year holiday, several regional markets geared up for an early closure on Tuesday.

Over the weekend, Robert Holzmann, a member of the European Central Bank's Governing Council, indicated to Austrian newspaper Kurier that the ECB might delay its next interest rate cut amid a recent surge in inflation.

In Italy, the Senate approved the government's deficit-reducing budget for 2025 on Saturday, emphasizing tax reductions and debt control measures.

Meanwhile, in France, the newly appointed finance minister revealed in a newspaper interview that the deferred 2025 budget bill will aim for a deficit slightly exceeding 5% to safeguard economic growth.

The pan-European STOXX 600 dipped 0.3% to 505.60, though it remained on track for a 6% annual increase. Germany's DAX, France's CAC 40, and the U.K.'s FTSE 100 experienced declines ranging from 0.1% to 0.3%.

In stock-specific movements, Italy's Eni gained 0.5% after announcing the commencement of phase two production at its Baleine oil field off the coast of the Ivory Coast.

Novartis AG's shares remained relatively unchanged following the publication of positive Phase III STEER study results evaluating intrathecal onasemnogene abeparvovec.

Siemens Healthineers saw a drop of more than 1% after Ralf Thomas, the Chief Financial Officer of Siemens AG, mentioned in the Handelsblatt newspaper that the company is reviewing its majority stake in the medical technology subsidiary.

BayWa experienced a 13% surge after the renewable energy firm disclosed plans to trim its workforce from 4,250 to 1,500 by the end of 2027 as a part of a restructuring effort.

Companies with ties to China, such as LVMH, Hermes International, and Kering, moved lower in anticipation of the Chinese manufacturing PMI data expected on Tuesday.

Shares of the aerospace company Rolls-Royce Holding declined by around 1% in London.

Lastly, South Korea's transport ministry announced it is "reviewing plans to conduct a special inspection" on Boeing 737-800 aircraft. This review follows an incident where a flight from Bangkok to Muan International Airport in South Korea crash-landed, resulting in the deaths of 179 out of 181 people onboard.