VIENNA (dpa-AFX) - European stocks pared last week's solid gains on Monday, as strength in German was offset by weak performances in other major markets.
Traders expressed concerns that U.S. lawmakers will set of a double-dip recession by failing to reach a compromise on the nations debt ceiling.
Jitters were also expressed about last week's plan to rescue Greece from its crushing debt load.
Moody's Investors Service on Monday lowered Greece's local and foreign-currency bond ratings to 'Ca' from 'Caa1', citing likelihood of substantial losses to private creditors on their government debt holdings.
The Euro Stoxx 50 index of eurozone bluechip stocks unofficially lost 0.96 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, fell 0.34 percent.
Unofficially, the German DAX added 0.25 percent, and the French CAC shed 0.77 percent. UK's FTSE 100 was sliding 0.16 percent and Switzerland's SMI was down 0.24 percent.
Dexia SA and Intesa Sanpaolo led banks lower after Moody's downgraded Greece three notches to Ca from Caa1.
In London, Lloyds Banking Group Plc slipped 4.2 percent after the Sunday Telegraph said it may consider an initial public offering for bank branches it is putting up for sale.
The Irish Government said Monday it has reached an agreement with a group of institutional investors and fund managers to sell about 14 percent stake in Bank of Ireland for up to 1.123 billion euros, helping the bank avert a possible nationalization.
Dutch insurer ING Groep NV said it has agreed to sell its Latin American pensions, life insurance and investment management operations for a total consideration of around 2.68 billion euros ($3.85 billion), as the first major step in the divestment of its insurance and investment management activities. Shares slipped 1.8 percent.
Deutsche Telekom lost 0.75 percent. Barclays increased its rating on the stock to 'Overweight' from 'Equal Weight.'
Automaker BMW rose 2.9 percent and Daimler added 1.3 percent. Volkswagen was marginally up. JPMorgan reduced European automobiles sector to 'Neutral' from 'Overweight.' However, the brokerage raised its price targets on all three carmakers.
Fiat was up 1.3 percent in Milan. JPMorgan raised its price target on the stock to 8.1 euros from 7.5 euros.
Barclays raised its price target for Adidas to 50 euros from 44 euros. The stock rose 1 percent.
Low-cost airline Ryanair Holdings Plc reported a rise in profit for the first quarter, owing to favorable comparisons with the prior year, which was affected by ash cloud from the Icelandic volcano. Revenue increased 29 percent, but operating costs also climbed. The stock was down 2.2 percent.
Construction materials maker Saint-Gobain slid 0.57 percent and cement giant Lafarge fell 0.17 ercent. JPMorgan raised European construction materials sector to 'Overweight.'
JPMorgan raised its price target on Renault to 66 euros from 64 euros. Shares were up fractionally.
Scania was down almost 5 percent in Stockholm. UBS cut the truckmaker to 'Neutral' from 'Buy' and reduced the price target to 135 Swedish kronor from 160 kronor.
Tire and rubber firm Michelin added 1.8 percent. JPMorgan cut its price target on the stock to 81 euros from 82 euros.
Reckitt Benckiser added 1.5 percent in London. The company reported a higher profit for its second quarter, as strong segmental results and the purchase of SSL International Plc boosted its net revenues.
Leoni AG rose 5.5 percent after the firm raised its full- year earnings forecast.
National Grid reaffirmed its outlook for fiscal 2012 and said it expects to deliver another year of 'good' operating performance. The stock was flat.
Gem Diamonds picked up 1 percent. The company said it sees record prices for rough diamonds in the first-half of the year.
Copyright RTT News/dpa-AFX