BERLIN, GERMANY – JANUARY 01: Fireworks explode over the Brandenburg Gate at midnight on New Year’s Day, January 01, 2024 in Berlin, Germany. Police in Berlin, concerned about outbreaks of violence such as those amidst the same festivities the previous year combined with further risks in relation to reactions to the ongoing war in Gaza, engaged in their largest deployment in decades. (Photo by Adam Berry/Getty Images)
This is CNBC's live blog covering European markets.
European stocks on Tuesday closed slightly lower, shortly after the regional benchmark hit its highest level in nearly two years.
The Stoxx 600 index ended down 0.2%, erasing gains of nearly 0.7% earlier in the session which saw it clock its highest level since Jan. 20, 2022, according to LSEG data.
Oil and gas stocks closed up 0.6% as investors monitored tensions in the Red Sea and the impact on oil prices, while the technology sector fell 1.8%.
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The latest euro zone purchasing managers' index from S&P Global, meanwhile, suggested the bloc entered a recession in the third quarter of last year.
A "relentless slump" in manufacturing meant output continued to decline in December, according to Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.
Asia-Pacific markets were mixed Tuesday, with China stocks dipping and Australian markets nearing an all-time high. Official data showed China's manufacturing PMI contracted further in December 2023 in a sign that more policy support was likely needed to revive its economy.
Money Report
Meanwhile, U.S. stocks fell on the first trading day of the year. It comes after a surprisingly strong 2023 that saw the S&P 500 rally 24%.
European stocks close slightly lower
European stocks closed slightly lower on Tuesday, shortly after the regional benchmark registered its highest level in nearly two years.
The pan-European Stoxx 600 ended 0.2% lower, with most sectors in negative territory.
— Sam Meredith
Maersk halts Red Sea shipping until further notice
Danish shipping giant Maersk on Tuesday said it would pause all shipping transit through the Red Sea and Gulf of Aden until further notice.
The decision comes shortly after one of its vessels came under attack from militants. It also extends a 48 hour pause implemented on Sunday in the immediate aftermath of the attack.
Shares of Maersk traded 6.4% higher on Tuesday afternoon.
— Sam Meredith
Airbus to assist French, Japanese investigators after planes collide at Tokyo airport
European planemaker Airbus said on Tuesday it is sending a team of specialists to provide technical assistance to French and Japanese authorities as they investigate a collision involving one of its A350 planes at Tokyo's Haneda airport.
The aircraft involved in the collision was delivered to Japan Airlines from the production line in Nov. 2021 and was powered by Rolls-Royce Trent XWB engines, Airbus said.
"Our concerns and sympathy go to the families, friends and loved ones affected by the accident," Airbus said.
Shares of Airbus were up 0.8% during afternoon deals.
— Sam Meredith
Stocks on the move: Maersk up; Watches of Switzerland down
Danish shipping giant Maersk topped European Stoxx 600 gains in mid-afternoon trade, rising 5.6%.
The company announced Sunday it would suspend all sailing through the Red Sea for 48 hours due to the ongoing threat of Houthi attacks, and is due to provide an update Tuesday. Disruption in the region has driven ocean freight rates sharply higher.
At the other end of the index, Watches of Switzerland and software firm Fortnox were both down by around 5%.
— Jenni Reid
Bond markets not necessarily the huge opportunity some have been anticipating, strategist says
Diversification is the key to harnessing opportunities in the market in the year ahead. That's according to Lindsay James, investment strategist from Quilter Investors, who believes spreading assets across indices and sectors is the most tactical play right now.
Euro lower with data in focus
The euro declined Tuesday morning, trading 0.69% lower against the U.S. dollar at $1.096 at 11:55 a.m. London time.
The euro was down 0.15% against the British pound at 0.866.
Investors are assessing another set of gloomy manufacturing data from the euro zone, and looking ahead to a slew of inflation data from France, Spain, Italy and Germany later this week, along with U.S. job openings and nonfarm payrolls.
The U.S. dollar index was 0.61% higher, extending cautious gains from late 2023 with all eyes on whether the Federal Reserve will deliver on market expectations for rate cuts this year.
— Jenni Reid
Bitcoin breaks above $45,000
Bitcoin traded above $45,000 for the first time since April 2022 to start the year, adding to the digital currency's sharp gains over the past 12 months. Bitcoin was last at $45,605, up 4.3% on the day, according to Coin Metrics. Over the past year, its up more than 170%.
— Fred Imbert
Euro zone manufacturing activity declines in December
The downturn in euro zone factory activity continued in December, according to S&P Global and Hamburg Commercial Bank's purchasing managers' index, as figures suggested a recession in the third quarter of 2023.
The manufacturing PMI reading for the bloc came in at 44.4, the best for seven months, but still well below the 50 mark separating expansion from contraction.
Output and job losses remained bleak, though new orders, purchasing activity and business confidence showed some signs of light on the horizon.
"Amid a relentless slump in the manufacturing sector of the Eurozone, the HCOB PMI has shown little improvement compared to November," said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.
"This indicates a sustained decline in both activity and demand for manufactured goods. The sluggishness of new orders echoes the gloom, retreating almost as swiftly as the previous month."
"Our Nowcast model aligns with this pessimistic trend, strongly suggesting a contraction in GDP for the fourth quarter. If this holds true, it paints a bleak picture for the Eurozone and would mean that the Eurozone entered a recession in the third quarter," he added.
— Jenni Reid
Europe stocks open higher
European stock markets opened higher Tuesday.
The benchmark Stoxx 600 index was up 0.43% at 8:05 a.m. London time, while most sectors moved higher. Oil and gas led gains, up 1.3%, as technology stocks slipped 0.2%.
Germany's DAX and France's CAC 40 both charged around 0.5% higher, while the U.K.'s FTSE 100 was up 0.25%.
— Jenni Reid
UK food inflation cools
Inflation in U.K. food prices eased to 6.7% in December from 7.7% the previous month, figures compiled by the British Retail Consortium showed.
It brings price rises to the lowest level since June 2022.
Overall shop price inflation was unchanged at 4.3%.
"Retailers will continue to do all they can to keep prices down in 2024, but there are obstacles on the road ahead. New border checks for EU imports, hundreds of millions more on business rates bills from April," Helen Dickinson, chief executive of the British Retail Consortium, said.
— Jenni Reid
Caixin China December manufacturing PMI comes in at 50.8
A private survey showed manufacturing activity in China expanded in December, at odds with a similar survey conducted by the country's statistics bureau that reported a contraction.
The Caixin manufacturing purchasing managers' index came in at 50.8 in December, according to a release Tuesday, following a 50.7 reading for November. China's official PMI fell to 49.0 in December from 49.4 the previous month, the country's National Bureau of Statistics said in a Sunday release.
A PMI reading above 50 indicates expansion in activity, while a reading below that level points to a contraction.
— Clement Tan
CNBC Pro: Goldman Sachs says these 3 Big Oil companies ‘screen as attractive’ – giving one 33% upside
Energy stocks may have had a tough year, but Goldman Sachs sees promise in European Big Oil – naming integrated oil stocks to play the theme in the new year.
"We are currently at a turning point as EU Big Oils started to outperform U.S. Big Oils, to potentially close their 40% valuation gap against their U.S. peers," the investment bank's analysts said.
The investment bank's positive outlook on Big Oil comes even oil prices were pushed up as major shipping lines and oil transporters suspended travel through the Red Sea. The 2024 outlook for oil has also been underwhelming, with the International Energy Agency expecting the slowdown to continue next year.
Even so, Goldman noted that "EU Big Oils now screen as attractive thanks to enhanced buyback programs, leading to double digit cash returns to shareholders," naming its top picks to play.
CNBC Pro subscribers can read more here.
— Amala Balakrishner
Dutch government partially revokes ASML's chip equipment export license to China
The Dutch government has partially revoked semiconductor equipment maker ASML's export license to China for two of its systems used in manufacturing advanced chips.
"A license for the shipment of NXT:2050i and NXT:2100i lithography systems in 2023 has recently been partially revoked by the Dutch government, impacting a small number of customers in China," said ASML in a statement.
NXT:2050i and NXT:2100i are deep ultraviolet lithography machines used in the volume production of the most advanced logic and memory chips.
The company said it does not expect the move to have a material impact on its financial outlook for 2023.
ASML has been restricted by the Dutch government from exporting its extreme ultraviolet lithography machines to China, in a bid to contain China's chip making tech. ASML has not shipped the equipment to China so far.
— Sheila Chiang
CNBC Pro: Time to invest in alternative assets? The pros aren't so sure
From family offices to financial advisors and beyond, interest in alternative assets appears to be growing — but the pros appear mixed on whether retail investors should get invested.
For Caesar Sengupta, CEO of financial services firm Arta Finance, there is "incredible value in private markets" and the assets shouldn't be overlooked.
Elsewhere, Saxo's chief investment officer Steen Jakobsen argues that retail investors need to err on the side of caution when dabbling in alternatives.
"I think you need to be more than a private retail investor to go into these — my advice is don't buy it, even if it's priced to perfection," he said, adding what asset classes he is bullish on for 2024.
CNBC Pro subscribers can read more here.
— Amala Balakrishner
European markets: Here are the opening calls
European markets are set to open higher Tuesday as investors kick off trading in 2024.
The U.K.'s FTSE 100 index is expected to open 20 points higher at 7,742, Germany's DAX up 48 points at 16,799 and France's CAC up 27 points at 7,570, according to data from IG.
There are no major data releases Tuesday.
— Holly Ellyatt
