Finance
European shares muted at start of holiday-shortened week
Published by Global Banking & Finance Review®
Posted on December 22, 2025
3 min readLast updated: January 20, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on December 22, 2025
3 min readLast updated: January 20, 2026
European shares were mostly unchanged as the STOXX 600 index faced pressure from beverage stocks. Low liquidity is expected due to the holiday-shortened week.
By Ragini Mathur, Purvi Agarwal and Twesha Dikshit
Dec 22 (Reuters) - European shares were little changed on Monday, with beverage stocks weighing on the index, as investors navigated a holiday-shortened week on a tepid note after a record close in the previous session.
The pan-European STOXX 600 ended down 0.09% at 586.99. Major regional bourses were also lower, with London and France down 0.3% and 0.4%, respectively.
The STOXX 600 gained more than 1% last week after a slowdown in U.S. consumer price inflation bolstered expectations for additional Federal Reserve interest rate cuts, while the European Central Bank maintained its current policy rates and took a more positive view of the euro zone economy.
Analysts expect some volatility in markets, driven by low liquidity heading into a holiday-shortened trading week.
"I think what we're seeing is a year-end positioning out of consumer, noncyclicals and also utilities and healthcare ...
and there seems to be a repatriation of funds going on into technology but in the U.S.," said Axel Rudolph, senior financial analyst at IG.
"Everybody seems to be focusing now on the festive period. There's far less liquidity, there's less volume trade."
Most sectors retreated following the robust gains on Friday, with the food and beverages category dropping the most. Shares of Diageo, the world's largest spirits group, fell 3.7% while those of French spirits maker Pernod Ricard and Stella Artois owner Anheuser-Busch InBev were down 2.9% and 2.5%, respectively.
China's commerce ministry has imposed anti-dumping measures on imports from the European Union, further straining tensions between Beijing and the bloc. The EU has imposed tariffs on China-made electric vehicles.
STOXX 600 POISED FOR BEST ANNUAL PERFORMANCE SINCE 2021
Commodity-linked sectors traded higher, with miners up almost 1% after gold prices raced past $4,400 per ounce for the first time and copper prices set a record high.
Shares of banks , which largely drove last week's gains, were little changed. The sector is up more than 65% on a year-to-date basis - it is one of the market's strongest performers - with analysts pointing to a pickup in merger-and-acquisition activity, lighter regulatory backdrop, and relatively stable economic environment.
The defence and aerospace sector retreated 0.4% after rising more than 3% in the previous two sessions.
"We anticipate positive macroeconomic momentum in the euro zone will persist, and corporate profit growth to pick up... we particularly like banks, utilities, industrials, technology and Germany," UBS Global Wealth Management analysts said.
Shares of oil firms gained 0.3%, tracking a rise in crude prices.
The STOXX 600 index is poised to deliver its strongest annual performance since 2021, benefiting from declining interest rates and global investors diversifying their portfolios away from premium-valued U.S. technology stocks.
On the radar will be a U.S. GDP reading this week, one of the final economic indicators before the end of the year.
Among stocks, Abivax jumped 15% after media reports of renewed chatter of U.S. pharmaceutical giant Eli Lilly attempting a takeover.
Orsted fell more than 12% after the Trump administration suspended leases for five large-scale offshore wind projects under national security concerns. The Danish energy firm owned two of the affected projects.
(Reporting by Twesha Dikshit, Utkarsh Hathi, Ragini Mathur and Purvi Agarwal in Bengaluru; Editing by Harikrishnan Nair, Tasim Zahid and Paul Simao)
The STOXX 600 is a stock index that represents 600 of the largest companies across 17 European countries, providing a broad measure of the European equity market.
Interest rate cuts refer to the reduction of the central bank's benchmark interest rate, aimed at stimulating economic activity by making borrowing cheaper.
Consumer price inflation measures the rate at which the general level of prices for goods and services rises, eroding purchasing power.
Merger and acquisition activity involves the consolidation of companies through various types of financial transactions, including mergers, acquisitions, and takeovers.
Volatility refers to the degree of variation in trading prices over time, indicating the level of risk or uncertainty in the market.
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