European markets begin the new trading week slowly as they await the Fed’s decision.

LONDON — European Stock Markets Dip as Investors Eye Fed Decisions

European stock markets saw a slight decline on Monday, as global investors turned their attention to the impending monetary policy decisions from the U.S. Federal Reserve.

The pan-European Stocks 600 index dipped below the flatline around 8:30 a.m. London time (3:30 a.m. ET), reflecting a mixed performance across major regional stock exchanges and sectors.

There’s a strong expectation that the Federal Reserve will cut its key interest rate at its final meeting of the year. Traders believe there’s about an 87% chance of a 25 basis point cut this Wednesday, coinciding with the end of a two-day meeting.

The Fed’s decision could set the tone for other central banks, which are also concluding their final policy meetings soon. For instance, the Swiss National Bank is due to release a policy update on Thursday, while the Bank of England and the European Central Bank are expected to announce their interest rate decisions on December 18.

As for the Bank of England, it’s still uncertain whether it will lower its benchmark interest rate. Meanwhile, the ECB is generally predicted to keep rates steady. The Bank of Japan will hold its last policy meeting for the year on December 19.

Defense stocks led European benchmarks, with companies like Hensoldt seeing notable gains, rising by 5%, 2.4%, and 2.3%, respectively.

In another headline, Keith Kellogg, who was President Trump’s special envoy to Ukraine, mentioned over the weekend that he was “very close” to brokering a deal to end the conflict in Ukraine. The two main sticking points appear to be the future of Ukraine’s Donbass region and the Zaporizhzhia nuclear power plant.

“If those two issues are resolved, I think the rest will fall into place pretty well,” Kellogg stated. “We’re almost there.”

On the corporate front, Unilever’s ice cream spin-off began trading on Monday. The new entity, the Magnum Ice Cream Company—encompassing brands like Magnum, Ben & Jerry’s, Wall’s, and Cornetto—has a reference trading price of €12.80 ($14.93) on Amsterdam’s main market, with secondary trading expected to kick off in London and New York.

Despite this development, Unilever’s early trading saw a drop of 4%.

There weren’t many significant gains across Europe on Monday. Additionally, Germany’s industrial production figures are set to be released soon.

Markets in the Asia-Pacific region traded mixed overnight, as investors reacted to data showing that China’s exports had risen more than anticipated in November. U.S. stock futures remained nearly flat on Sunday night after U.S. markets experienced a rally on Friday, driven by weaker-than-expected consumer spending price index data for September.