European stocks traded lower Monday, as a selloff in precious metals unnerved investors at the start of a week packed with corporate earnings, central bank meetings and economic data. 

At 03:05 ET (08:05 GMT), the DAX index in Germany dropped 0.4%, the CAC 40 in France slipped 0.5% and the FTSE 100 in the U.K. fell 0.6%. 

Sentiment hit as precious metals fall further  

Sentiment has been hard hit Monday by gold and silver extending their sell-off, deepening losses from Friday’s rout as the nomination of Kevin Warsh as the next Fed chair resulted in a sharp rise in the U.S. dollar, prompting investors to take profits, ending a rally that had propelled the precious metals to record highs just days earlier.

Spot gold lost just under 6% to $4,597 per ounce on Monday, having crashed nearly 10% on Friday, the steepest one-day drop in spot gold since 1983. 

Silver, which had surged alongside gold on safe haven demand and speculative inflows, also remained under pressure after last Friday’s 30% slump that saw the metal log its worst day since March 1980.

Adding to the concerns, CME announced it was raising margins on several metals contracts with effect from Monday’s market close, implying some investors are having trouble meeting margin calls and may need to dipose of liquid assets.

Intesa Sanpaolo impresses with 2025 profit

Turning back to the corporate sector, this is set to be another busy week for quarterly earnings, with around 30% of the EuroSTOXX index’s market capitalization scheduled to report results.

Earlier Monday, Intesa Sanpaolo (BIT:ISP) reported a 7.6% rise in 2025 net profit to €9.3 billion, and the Italian bank announced plans to return €8.8 billion to shareholders through dividends and buybacks, cementing its position as one of Europe’s most profitable lenders.

Swiss bank Julius Baer (SIX:BAER) reported a net profit of CHF764 million for 2025, down 25% from 2024, but slightly above a consensus expectation of CHF679 million francs.

On Wall Street, all eyes this week will be on tech majors Alphabet (NASDAQ:GOOGL) and Amazon (NASDAQ:AMZN), particularly as sentiment toward AI-linked shares has deteriorated following results from Microsoft (NASDAQ:MSFT), which highlighted rising costs tied to heavy AI investment and raised questions about near-term returns.

German retail sales inch higher 

Data released earlier in the session indicated that German retail sales rose 0.1% in December compared with the previous month, an improvement from the drop of 0.5% seen in the previous month.

Manufacturing activity data for January are expected for the eurozone later in the session, and are expected to show a slight improvement from the previous month while remaining in contraction territory.

Data released on Saturday showed that China’s official manufacturing PMI slipped further below the 50 mark in January, pointing to a contraction in factory activity and highlighting persistent weakness in domestic demand.

Both the European Central Bank and the Bank of England are scheduled to hold policy-setting meetings this week, and both are expected to keep interest rates unchanged.

Crude falls as risk premium retreats

Oil prices fell sharply Monday as concerns of a U.S. strike on Iran eased, after U.S. President Donald Trump said the Middle East crude producer was “seriously talking” with Washington.

Brent futures dropped 4.8% to $65.97 a barrel and U.S. West Texas Intermediate crude futures fell 5% to $61.91 a barrel.

Crude prices had risen sharply last week as markets priced in a greater risk of supply disruptions from this key region after Trump had repeatedly threatened Iran with military action over a nuclear deal and ongoing protests in the country. 

However, risks of a military strike receded after Trump’s weekend comments.

The Organization of Petroleum Exporting Countries and allies, a group known as OPEC+, left production unchanged during a weekend meeting, as broadly expected.