By Shreyashi Sanyal
(Reuters) – European shares were flat on Monday, with the sustained gains in miners on bets of a demand recovery in China countering a fall in Telecom Italia that led the decliners in eurozone stocks.
The pan-European STOXX 600 index was flat after opening marginally higher.
The basic resources index climbed 1.4% after prices of industrial metals rose on hopes of a recovery in demand from top consumer China and on support from global mining supply disruptions.
That also boosted oil prices, lifting European energy stocks by 0.3%.
The EURO STOXX index, which houses major companies in the eurozone, dipped 0.1%.
Telecom Italia (TIM) shares dropped 3% as a government-sponsored offer rivalling KKR’s bid for the former phone monopoly’s prized grid failed to materialise over the weekend.
Global markets were bogged down for much of last week after hotter-than-expected U.S. inflation data added to a growing pile of evidence that aggressive rate hikes have not yet cooled prices to the Federal Reserve’s satisfaction.
“It seems like a little bit of a of a pause to assess what’s going on and a lack of direction really,” said Daniela Hathorn, senior market analyst at Capital.com.
“We’re still not sure about everything that’s going on with the latest data showing that the U.S. economy might not be slowing as much as we thought. So, people are still trying to digest what that means.”
It was a quiet day of trading in Europe, with U.S. stock markets shut on Monday for the Presidents’ Day holiday.
Austria’s Raiffeisen Bank International fell nearly 7% after Reuters reported the United States’ sanctions authority launched an inquiry into the lender over its business related to Russia.
Forvia, the European car parts maker born from Faurecia’s takeover of Hella, forecast stable 2023 sales, sending Faurecia nearly 4.0% higher to the top of the STOXX 600.
The European autos and auto parts sector index rose 0.6%.
(Reporting by Shreyashi Sanyal in Bengaluru; Editing by Savio D’Souza and Dhanya Ann Thoppil)