European stocks recover; ECB decision, US data in focus

By Ragini ‌Mathur and Purvi Agarwal

Dec 15 (Reuters) - European shares edged higher on Monday, kicking off a week packed with central ‍bank decisions ‌and delayed U.S. economic data on a positive note, as investors returned to risk assets after last week's subdued ⁠finish.

The pan-European STOXX 600 was up 0.6% at 581.85, ‌as of 0940 GMT, putting it less than 1% away from a record high. Major regional bourses also advanced, with Spain's hitting an intraday record high.

The STOXX 600 slipped into negative weekly territory at the last moment, mirroring losses on Wall Street on Friday after U.S. ⁠chipmaker Broadcom's profit margin warning sparked renewed concerns about a potential bubble in artificial intelligence stocks.

The market staged a broader recovery on Monday, with 19 ​of the 20 main sectors trading higher, led by heavyweight banks and ‌miners up more than 1% each.

XTB's research director Kathleen ⁠Brooks said that risk sentiment was stabilizing after the sell-off as markets turned their attention to macroeconomic factors this week.

Healthcare was trading in the red, weighed down by a 3.2% drop in French drugmaker Sanofi after expectations grew ​that the U.S. Food and Drug Administration would delay a decision on its multiple sclerosis drug, tolebrutinib.

Over the weekend, Ukraine President Volodymyr Zelenskiy offered to drop the country's aspirations to join the NATO military alliance after talks with the U.S. in Berlin that are set to continue on Monday.

Major defence firms slipped, with Rheinmetall and Renk off 2.8% ​and 1.7%, respectively. ‍The broader aerospace and defence index ​was off 0.3%.

On the flip side, Ukraine-exposed miner Ferrexpo jumped as much as 11%.

The STOXX 600 has had a positive December so far, as optimism around U.S. interest rate cuts and progress on a Russia-Ukraine ceasefire lifted sentiment.

"Markets are expecting earnings growth and looser monetary policy, so many investors think this is a supportive market environment for European indices," said Roland Kaloyan, head of European equity strategy at Societe Generale.

On the macro front, the European Central Bank's monetary policy decision is due ⁠on Thursday, with markets widely expecting it to keep rates on hold.

Market sentiment shifted last week following unexpectedly hawkish comments from ECB policymaker Isabel Schnabel, who suggested a rate ​hike could be the next move, though it would not happen in the near term.

Decisions from Sweden's Riksbank, UK's Bank of England and Norway's Norges Bank are also expected this week.

Delayed jobs and inflation data in the U.S. this week could also set the tone for global markets heading into 2026.

Among others, Argenx ‌shares slumped 7.2% to the bottom of the STOXX 600 after the Dutch biopharma company discontinued a phase 3 trial for its thyroid eye disease treatment.

(Reporting by Purvi Agarwal and Ragini Mathur in Bengaluru; Editing by Sherry Jacob-Phillips and Tasim Zahid)