European shares closed down on Monday, as euro zone data disappointed and turmoil in Iraq continued.
The pan-European FTSEurofirst 300 Index closed provisionally down 0.4 percent at 1,388.82 points on Monday.
The euro zone Purchasing Managers' Index (PMI) from Markit came in at 52.8 for June, against forecasts of 53.5. A reading of 50 or more marks increased business activity.
"A concern is that a second consecutive monthly fall in the index signals that the euro zone recovery is losing momentum," Chris Williamson, chief economist at Markit, said.
The index highlighted ongoing divergence between the euro zone's two largest economies, with French activity contracting further in June, while Germany's private sector continued to expand.
However, Europe's basic resources sector—which has heavy exposure to China—closed up around 1.0 percent, after the release of upbeat figures from the world's second largest economy. A reading of Chinese PMI from HSBC showed the first expansion in six months. The figure was well-above the 49.7 expected, and above May's final reading of 49.4.
Developments in Iraq remained in focus throughout the day.
U.S. Secretary of State John Kerry arrived in Baghdad on Monday to push the Iraqi Prime Minister to form a more inclusive government in an attempt to stem the Sunni insurgency. Militants reportedly seized a frontier post on the Iraqi-Syrian border on Sunday, a day after grabbing another border-crossing further north.
Airlines have been hurt by concerns over supply disruptions from the violence. Shares in Air France closed down around 2.4 percent, while Ryanair and Lufthansa closed down around 1.2 percent and 0.9 percent respectively.
The ongoing saga surrounding Alstom looked to be nearing a conclusion on Monday. Shares in the French engineering group closed down more than 4.8 percent.
The French government has secured a last-minute deal, giving it the option of buying 20 percent of Alstom from industrial group Bouygues. This could clear the way for an agreed tie-up between Alstom and General Electric and give the French government some control over sensitive nuclear turbines in the country.
Read MoreFrance secures option to buy Alstom stake
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