- China's Zhu warns of spill-over effect of Fed tapering
- US considers action in Syrian crisis
- US house prices, German business confidence reports
CAC 40: -0.47%
FTSE MIB: -0.11%
IBEX 35: -0.66%
Stoxx 600: -0.50%
European equities fell as uncertainty surrounding the tapering of Federal Reserve stimulus continued as the potential US involvement in the Syrian crisis pushed oil prices
The Fed is weighing up whether to begin scaling back its $85bn per month in bond purchases this year. Economists expect the central bank to start in September amid mixed messages from Fed members and market commentators.
"There are three Fed meetings left this year and as such, should we not see a September taper, October or December would be their remaining options," according to Alpari Research.
"Given a relative lack of strong data, it could be the case that the Fed delay until the October meeting should the figures show continued weaknesses between now and September 17th."
China's Vice Finance Minister Zhu Guangyao said the Fed must consider when and how fast it unwinds its economic stimulus to avoid harming emerging market conditions. He warned of the spill-over effect, "especially the opportunity and rhythm of its exit from the ultra-loose monetary policy", in a briefing ahead of the G20 summit in Russia next week.
Meanwhile as the tension in Syria mounted, Obama spoke with Australian Prime Minister Kevin Rudd on Monday about possible international responses to the turmoil.
The White House said the two leaders expressed their grave concern about the reported use of chemical weapons by the Syrian regime against civilians near Damascus on Wednesday.
Obama administration officials said there was little doubt the Syrian government was responsible for an attack that claimed the lives of hundreds of men, women and children.
US officials said they would want to win international support before taking action.
US and German economic data
A report on Germany's business confidence is expected to show a rise for the fourth consecutive month in August when released at 10:00 in Berlin. The Ifo institute's business-climate index, based on a survey of 7,000 executives, rose to 107.0 from 106.2 in July, economists predict.
In the US, the S&P/Case-Shiller index of house prices in 20 cities is anticipated to jump 12.1% in June compared to the prior year when unveiled at 9:00 in New York.
surged after the oilfield services company said it remains on track to deliver growth for the full year.
Aker Solutions declined after second-quarter earnings fell short of analysts' estimates.
ThyssenKrupp AG plunged after Nomura downgraded the steelmaker to 'neutral' from 'buy'.
PSA Peugeot Citroen advanced after UBS raised its recommendation on the shares to 'buy' from 'neutral'.
Other asset classes climb
The euro/dollar rose 0.04% to the 1.3373 dollar
Brent crude futures were up $0.108 to $110.850 per barrel on the ICE.