European markets start December in negative territory; Airbus slid over 5%

The pan-European Stoxx 600 index preliminarily closed the session 0.2% lower on Monday, with major bourses and most sectors in negative territory.

Regional markets closed higher on Friday, marking the end of a choppy month for stocks as concerns over lofty artificial intelligence valuations returned to the fore.

Uncertainty over monetary policy also affected sentiment last month but investors are now expecting the U.S. Federal Reserve to trim interest rates when it meets on Dec. 9-10. Traders are pricing in an 87.4% chance of a quarter-point rate cut, according to the CME FedWatch Tool.

The U.K.’s central bank is also closely monitoring the Fed for any potential spillover effects. “About half the moves in our curve actually are generated entirely outside the U.K.,” Megan Greene, who sits on the Monetary Policy Committee at the Bank of England, told CNBC’s Ritika Gupta in an exclusive interview on Monday.

The BOE has not committed to cutting rates in December, on the backdrop of persistent inflation risks, wage growth sitting above target, labor market weakening and snails-pace consumption.

The U.K.’s Autumn Budget last week delivered some deflationary measures, namely in energy and rail fares, which should benefit consumers in the short-term, Greene said, though the bank “should look through that” to establish price stability in the medium term.