European markets retreat as Ukraine concerns rise; Fed meeting ahead


LONDON — European stocks were lower on Monday as investors braced themselves for the next meeting of the U.S. Federal Reserve this coming week, and watched for developments in Ukraine as tensions with Russia grow.

The pan-European Stoxx 600 fell 0.5% in early trade, with tech stocks shedding 1.5% to lead losses while telecoms added 0.8%.

European markets are following their Asia-Pacific counterparts lower on Monday as investors react to heightened tensions between the Ukraine and Russia, and look ahead to the U.S. Federal Reserve’s monetary policy meeting this week.

The Federal Open Market Committee is due to meet on Tuesday and Wednesday to decide on the next steps for U.S. monetary policy.

Rising inflation is a major concern for the U.S. central bank and investors will listen closely to hear how worried the Fed actually is — Chairman Jerome Powell is due to brief the media Wednesday afternoon local time after the FOMC releases its statement.

In the meantime, markets are likely to be shaken by concerns that there could be an imminent military conflict between Ukraine and Russia.

The U.S. State Department recommended Sunday that all U.S. citizens in Ukraine depart the country immediately, citing Russia’s extraordinary military buildup on the border.

“Our recommendation to U.S. citizens currently in Ukraine is that they should consider departing now using commercial or privately available transportation options,” a senior State Department official said Sunday evening on a call with reporters.

On Saturday, the U.K. accused the Kremlin of seeking to install a pro-Russian leader in Ukraine. Russia has repeatedly denied it is preparing to invade its neighbor.

Earnings came from Philips on Monday, and data releases include U.K. and euro zone flash purchasing manager’s index (PMI) figures for the services and manufacturing industry in January.

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— CNBC’s Amanda Macias and Saheli Roy Choudhury contributed reporting to this story.

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