European shares ended lower on Monday after investor concerns about the impact of oil prices on the recovery prompted a late afternoon sell-off, with banks among the biggest sector fallers. The pan-European FTSEurofirst 300 index of top shares closed down 0.4 percent at 1,143.86 points after being up as much as 1,157.38 earlier in the session after M&A news lifted sentiment.
Volume was at 97.9 percent of the index's 90-day average. The STOXX Europe 600 Banks was among the worst performing sectors, down 0.8 percent, with certain stocks exposed to the euro zone periphery hard hit after ratings agency Moody's downgrraded Greece by three notches Dexia, Credit Agricole and Societe Generale all ended down 1.4 percent to 2 percent.
The mining sector was also under pressure after investors decided to take risk off the table on worries the global recovery may stall. Vedanta Resources, Rio Tinto and Kazakhmys slipped 1.7 to 3.6 percent. Looking at individual stocks on the downside, satellite telecommunications operator Inmarsat dropped 13.4 percent after a key maritime revenue forecast missed expectations.
On the upside, merger and acquisition news boosted luxury good stocks after France's LVMH said it would buy Italy's Bulgari in a 3.7 billion euros ($5.19 billion) deal. Sector peers Richemont and Burberry Group gained 2.2 percent and 3.6 percent respectively. British testing firm Intertek rose 5 percent after it announced it was buying quality and safety services firm Moody International and reported forecast-beating full-year profits.
Tognum was up 23.1 percent on news that Daimler and Rolls-Royce were considering a joint bid for the enginemaker. Europe's stock valuation levels remained relatively low, with the STOXX Europe 600 carrying a forward P/E ratio of 10.95, well below a 10-year average of 13.61, according to Thomson Reuters Datastream. Across Europe, the FTSE 100 index was down 0.3 percent, Germany's DAX was down 0.2 percent and France's CAC 40 was down 0.7 percent.
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