European Markets Drop On Concerns Over OPEC And Italy

(RTTNews) - The European markets ended the first session of the new trading week in the red. The markets got off to a weak start this morning and remained locked in a sideways trend for most of the session.

Traders were in a nervous mood ahead of a key OPEC meeting on Wednesday. Uncertainty about whether the members of the cartel will manage to finalize an agreement on reducing oil production continues to weigh on sentiment.

Recent optimism about the outcome of the meeting was partly offset by news that Saudi Arabia pulled out of a meeting with non-OPEC oil producing countries scheduled for today.

Investors are also increasingly worried about Italy's future in Europe's monetary union ahead of the much-awaited Italian referendum on constitutional reforms to be held this Sunday.

Italian Prime Minister Matteo Renzi is staking his political future on this referendum that would change the Italian constitution by weakening the upper house of parliament and strengthening the central government. Italian banks were under heavy pressure during today's session.

Francois Fillon was victorious in the second round of the conservative primary race for next year's presidential election in France after promising drastic free-market reforms and a crackdown on immigration and Islamic extremism.

Eurozone proved to be resilient to many shocks this year amid the uncertainty arising from the economic and political environment, largely due to the stimulus measures adopted by the European Central Bank, the bank's chief Mario Draghi said Monday.

"In 2016 the euro area economy proved to be resilient, in spite of uncertainty stemming from the economic and political environment," ECB President Draghi said in his opening remarks at a hearing in the European Parliament in Brussels.

"Inflation has gradually edged up, and the ECB's monetary stimulus has been a key ingredient of the ongoing recovery."

The euro area economy continues to expand at a moderate, but steady pace and this gradual upward trend is expected to continue, Draghi said.

"Still - if supported by decisive action taken by other policymakers - monetary policy measures in the euro area could be even more effective," he added.

The pan-European Stoxx Europe 600 index weakened by 0.84 percent. The Euro Stoxx 50 index of eurozone blue chip stocks decreased 1.04 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, lost 0.96 percent.

The DAX of Germany dropped 1.09 percent and the CAC 40 of France fell 0.88 percent. The FTSE 100 of the U.K. declined 0.60 percent and the SMI of Switzerland finished lower by 0.74 percent.

In Frankfurt, Commerzbank dropped 3.09 percent and Deutsche Bank forfeited 2.42 percent.

Deutsche Lufthansa weakened by 2.26 percent and Volkswagen fell 0.83 percent. In Paris, BNP Paribas declined 2.62 percent and Credit Agricole surrendered 2.17 percent. Societe Generale also finished lower by 2.12 percent.

Technip decreased 1.50 percent and Total slipped 0.15 percent.

In London, Man Group tumbled 4.52 percent on a brokerage downgrade.

Miner Antofagasta climbed 0.83 percent after announcing it had signed an agreement to sell Minera Michilla SA to Haldeman Mining Co. SA for a total consideration of $52 million.

Randgold Resources gained 4.28 percent and Fresnillo rose 3.73 percent as gold prices climbed. Polymetal International also added 3.22 percent.

Shares of Aberdeen Asset Management dropped 3.95 percent after the investment management group posted a year-on-year drop in full-year revenue and profit.

Royal Bank of Scotland dropped 2.53 percent and Barclays fell 1.67 percent. Lloyds Banking Group forfeited 1.55 percent and Standard Chartered weakened by 0.71 percent. Shares of HSBC also lost 1.28 percent.

Bakery business Aryzta gained 1.39 percent in Zurich after its total revenues for the first quarter declined 3.3 percent from last year to 962.3 million euros.

Actelion climbed 2.98 percent after Johnson & Johnson confirmed that it has engaged in preliminary discussions with the biopharmaceutical company regarding a potential transaction.

Eurozone money supply expanded at a slower pace, while private sector credit growth improved in October, the European Central Bank reported Monday. The broad monetary aggregate M3 climbed 4.4 percent year-on-year in October after rising 5.1 percent in September, averaging 4.8 percent in the three months up to October.

Italy's consumer confidence declined to a 16-month low in November, survey data from the statistical office Istat showed Monday. The consumer confidence index fell to 107.9 from 108 in October. This was the lowest reading since July 2015, when the score was 107.0.

The U.K. service sector optimism weakened in three months to November as profitability declined, the latest quarterly Service Sector Survey from the Confederation of British Industry showed Monday. Business and professional services firms reported that business volumes barely increased and they are expected to fall slightly in coming quarter.