Investing.com - European stocks were mixed in light trade on Monday, as market sentiment was weighed by concerns U.S. lawmakers will be unable to agree on a way to avoid a fiscal crisis before the end of the day.
During European morning trade, France's CAC 40 added 0.14%, while the EURO STOXX 50 and Germany's DAX 30 were closed for New Year's Eve.
Trading volumes were expected to remain thin as many investors already closed books to lock in profit before the end of the year, reducing liquidity in the market and increasing the volatility.
Market players remained focused on developments surrounding the fiscal cliff in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1 unless Democrats and Republicans agree how to cut the deficit.
U.S. President Barack Obama met with congressional leaders at the White House Friday afternoon, but both sides failed to reach an agreement ahead of the looming year-end deadline.
Senate Majority Leader Harry Reid said the Senate would resume sitting on Monday to continue discussions, but there were still significant differences between the two sides.
French lenders were lower, as shares in BNP Paribas and Societe Generale declined 0.28% and 0.80%.
Automakers added to losses as Renault saw shares slide 0.47%, while Peugeot tumbled 1.16%.
Energy-linked stocks trended higher on the other hand, with oil and gas giant Total adding 0.28%, while Electricite de France rose 0.14%.
In London, commodity-heavy FTSE 100 dropped 0.40%, weighed bu sharp losses in oil and mining stocks.
Oil and gas major Anglo American retreated 0.77% and steel maker Evraz plummeted 2.41%, while mining giants Rio Tinto and BHP Billiton declined 0.64% and 0.17% respectively.
Copper producers were also on the downside, as Xstrata and Kazakhmys dropped 0.59% and 0.53%.
In the financial sector, stocks were broadly lower. Shares in Barclays slid 0.52% and the Royal Bank of Scotland retreated 0.66%, while HSBC Holdings and Lloyds Banking tumbled 0.73% and 1.17%.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.27% rise, S&P 500 futures signaled a 0.48% increase, while the Nasdaq 100 futures indicated a 0.14% gain.
Also Monday, a report from HSBC released earlier confirmed that manufacturing activity in China expanded at the fastest pace since May 2011 in December. The final version of China's HSBC Purchasing Managers Index rose to 51.5 in December from a final reading of 50.5 in November.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.