LONDON — European stocks were lower at the closing bell on Monday, erasing earlier gains.
The pan-European Stoxx 600 was preliminarily down 0.53% by the end of the session, with most sectors and major bourses negative territory.
Saab was one of the strong gainers on Monday after the Swedish aerospace and defense name announced on Friday a $3.6 billion deal to supply Colombia's government with 17 Gripen fighter jets over the next five years. Saab's share price gained 7.4% by late Monday morning, but pared gains later in the session and ended the session 2.6% higher.
Shares of Airbus rose around 0.4% through the session amid reports that the European aircraft manufacturer was close to securing a deal to supply almost 100 planes to flydubai at the Dubai Airshow, beating rival Boeing to take the bulk of the budget carrier's jet order.
Meanwhile, WPP advanced 11% following a report that the U.K. advertising agency is drawing takeover interest from private equity giants Apollo Global Management and KKR and smaller peer Havas.
Monday's market caution among regional stocks follows a troubled week for European markets last week, with regional bourses closing sharply lower on Friday as concerns about an artificial intelligence bubble and the global economy shook investor confidence.
Meanwhile, comments from U.S. Federal Reserve officials in recent weeks have also prompted investors to reconsider the likelihood of a December rate cut. On Monday, markets are pricing in a 58% chance that the Fed stands pat on rates at its next meeting, according to CME Group's FedWatch tool. A month ago, the market had assigned a 95% probability to an end of year cut.
Stateside, stock were mixed as Wall Street anticipated key releases this week, including Nvidia earnings and the September jobs report. It follows a choppy end to last week in which valuation fears, a rotation within the market and a recalibration of Federal Reserve rate cut expectations pressured the artificial intelligence trade.
Meanwhile, Asia-Pacific markets traded mixed on overnight as investors assessed rising friction between Japan and China after Beijing warned its citizens about travel and study plans in Japan.
There were no major European earnings or data releases Monday.
— CNBC's Fred Imbert and Lee Ying Shan contributed to this market report.