European stocks finished slightly lower on Monday, as weak performance in the Italian banking sector and a decline in oil prices capped gains in the region.
The pan-European STOXX 600 ended down 0.1 percent provisionally, with a mixed end to the day for a lot of sectors.
In France, the CAC 40 closed up 0.3 percent, while Germany's DAX pushed higher, ending up 0.8 percent, following an upbeat manufacturing survey report. London's FTSE 100 was closed due to a public holiday.
Thin trade on the ground
European markets
Trading was expected to be thinner than usual on Monday, as a handful of European markets were closed due to public holidays, including those in the U.K., Ireland, Greece and Russia.
Overseas, U.S. markets posted gains after the release of key manufacturing data, while in Asia, most markets ended in negative territory. Japan's Nikkei tumbled over 3 percent, in the wake of a stronger yen, while several markets were closed for a public holiday, including those in China, Singapore, Malaysia and Hong Kong.
In commodity markets, oil came under sharp pressure on Monday, on news that crude production by OPEC members had increased to 32.64 million barrels a day in April, according to Reuters. Brent saw prices decline over 2 percent by Europe's close, trading at $46.39, while U.S. crude was off over 1.5 percent, around $45.19 a barrel.
A slew of European manufacturing PMI data came out on Monday, with the latest euro zone figure revealing that factories in the region saw a slight tick-up in performance during April. Markit's manufacturing Purchasing Managers' Index (PMI) for the euro zone increased to 51.7 in April, beating flash estimates of 51.5 and up from March's 51.6.
For Germany, April manufacturing PMI came in at 51.8, up from March's 50.7 figure, as new orders increased at a faster pace, with demand growing both domestically and abroad. This gave a boost to Germany's DAX, and to some of its automakers, including BMW and Daimler.
Another boost for auto stocks included the latest French new car registrations, which rose 7.1 percent year-on-year in April. This pushed the likes of Valeo higher, which closed up almost 1.5 percent, while Italian-listed Fiat Chrysler led the sector, ending over 2 percent up.
Shares in Ferrari initially popped as much as 3 percent, after the luxury carmaker posted a strong set of results for its first quarter. The Italian firm also increased its guidance for 2016, and announced that chairman Sergio Marchionne would become the firm's CEO, after Amedeo Felisa retires. Shares ended in the red, off 0.8 percent.
Italian banks under pressure
Italian banks took a hammering after the cash call by Banca Popolare di Vicenza ended up being a flop. The bank was looking to raise 1.5 billion euros by issuing shares but only but said on the weekend that investors only placed orders for 7.7 percent of the shares, underlying the negative sentiment towards the Italian banking sector. Italy's new fund Atlante, which is supposed to act as a backstop for the banks, has stepped in to buy the remaining shares.
Banca Monte dei Paschi di Siena fell 5.5 percent, while Banca Popolare di Milano slipped 6 percent and Unicredit was off over 3.5 percent as a result. This weighed on Italy's FTSE MIB, which closed 1 percent down.
Fellow Italian lender, Intesa Sanpaolo said on Monday it has agreed to sell its Setefi and Intesa Sanpaolo Card payments unit to a consortium of buyers for around 1.04 billion ($1.2 billion), but shares closed down 2 percent.
Elsewhere in the sector, Deutsche Bank ended 2.7 percent lower after U.K. watchdog the Financial Conduct Authority (FCA) said the German lender had "serious" and "systemic" failings in its controls against money laundering, sanctions and terrorist financing, according to the Financial Times. In a statement, Deutsche Bank said it is working with the regulators.
In other individual stocks, insurance giant Allianz posted a 3.5 percent fall in first-quarter operating profit, however shares reacted positively after the firm's net profit rose to 2.2 billion euros, and said it was confident it could reach its 2016 outlook. Shares jumped almost 3 percent.
Luxottica and Hermes outperformed the majority of stocks on Monday, both closing higher, up 3.8 and 2.2 percent respectively. After Europe's close on Friday, Ray-Ban manufacturer Luxottica reported net sales of 2.26 billion euros for the first quarter. Fellow luxury firm, LVMH also closed higher.