According to a report from the Wall Street Journal,The Stoxx Europe 600 index dropped 0.2% to close at 319.49, adding to a small loss from Friday. The benchmark, however, closed out last week 0.5% higher, for the largest three-week gain since Sept. 20.
Auto makers were among top decliners after J.P. Morgan Cazenove cut the sector to neutral from overweight and instead moved funds to utilities, raising them to neutral from underweight.
"Autos are the best performing sector year-to-date in Europe, up 31%, more than double the performance of the overall market," Mislav Matejka, its chief European equity strategist, wrote in a note. He cautioned that the sector could be vulnerable to some profit-taking in the near term.
"We think that their earnings momentum could be stalling in the near term as PMIs have stopped moving higher," he added.
Shares of Peugeot SA skidded 5.8% and Renault SA fell 3.7% in Paris, Fiat SpA dropped 3.2% in Milan and BMW AG and Daimler AG both lost 1.5% in Frankfurt.
More broadly, investors were waiting for more signals from the U.S. about when the Federal Reserve could begin tapering its monthly bond purchases before placing any bigger positions. The Federal Open Market Committee meets on Tuesday and Wednesday this week, and most analysts expect no changes to interest rates or the quantitative-easing program
