According to analysts, the UK’s FTSE Index is set to open down 0.26%, Germany’s DAX Index down 0.62%, France’s CAC 40 Index down 0.46%, and Italy’s FTSE MIB Index down 0.5%. Regional markets closed in positive territory on Friday at the end of a volatile month for stocks, as concerns over high artificial intelligence valuations resurfaced.
Uncertainty over monetary policy also affected markets last month, but investors now expect the US Federal Reserve to cut interest rates at its meeting on December 9-10. According to analysts, investors are pricing in an 87.4% probability of a quarter-point interest rate cut.
European investors will closely follow developments towards a peace deal in Ukraine this week, as US Special Representative Steve Witkoff travels to Moscow to meet with Russian President Vladimir Putin and other Kremlin officials.
The talks come after Ukraine announced it has approved in principle a US-backed 19-point peace plan. The plan is a modified version of an initial 28-point plan secretly prepared by the US and Moscow, which was seen as favoring Russia.
Ukrainian and US officials, led by US Secretary of State Marco Rubio, held further talks in Florida over the weekend. Rubio said the talks were “very productive,” but that there is still much work to be done.
Asia-Pacific markets started December mostly lower, as investors assessed new manufacturing data from China and expectations that the US Federal Reserve (Fed) will cut rates this month.
Japan’s Nikkei 225 index fell 1.3%, while the Topix index declined 0.72%. Among the biggest losers on the Nikkei 225 were electrical equipment company Fujikura, down 8.11%, Sumitomo Pharma, down 5.82%, and Advantest, down 4.74%. South Korea’s Kospi index fell 0.66%, while the small-cap Kosdaq rose 1.29%. Australia’s S&P/ASX 200 index fell 0.23%.
Meanwhile, US stock futures changed little on Sunday night after a profitable week, as investors prepare to close out a strong 2025.
Seasonality is also on Wall Street’s side. According to the Stock Trader’s Almanac, the S&P 500 posts an average gain of over 1% in December, making it the third-best month of the year in records dating back to 1950.
There are no major earnings or data releases in Europe on Monday.
