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European shares inched higher on Monday, helped by gains in tech and healthcare stocks, but Fiat Chrysler slumped on a report raising emissions issues and Bayer dropped after making an offer for Monsanto.
The pan-European FTSEurofirst 300 index, which had risen 1.3 per cent in the previous session, was up 0.2 per cent at 1,329.6 points by 0820 GMT.
Fiat Chrysler fell 3.7 per cent, making it the top loser on the FTSEurofirst, after Bild am Sonntag newspaper said the carmaker could be prohibited from selling cars in Germany if evidence of continued disregard of emissions rules is found.
A Fiat Chrysler spokesman declined to comment on report but said all the carmaker's vehicles are compliant with existing emissions regulations.
UBS, which has a neutral rating on the stock, said the German newspaper report was negative for sentiment but it saw no impact on earnings at the moment.
“We doubt Fiat Chrysler would be fully prohibited from selling cars in Germany, given that Volkswagen was allowed to continue selling cars even as defeat devices were found in some of its cars,” the Swiss broker said in a note.
Bayer fell 2.1 per cent after the German drugs and chemicals group said it had made an offer to buy US seeds company Monsanto for $62 billion in a deal that would be financed in debt and equity.
“The very large equity portion of the deal is likely sustaining the negative investor sentiment. Further, we expect Monsanto to reject the offer initially as such protracting the uncertainty around Bayer shares,” Helvea said in a note.
Among tech stocks, Aixtron soared 15 per cent after China's Fujian Grand Chip Investment Fund agreed to make a bid for the German semiconductor equipment maker.
In the healthcare sector, Novartis rose 2.3 per cent after new global guidelines on the treatment of heart failure strongly endorse the use of its Entresto, boosting the prospects for a drug that has struggled to gain traction.
Miners were the top sectoral losers, down 0.4 6 per cent, as copper prices were mired near three-month lows after the dollar held strong on expectations the United States could raise interest rates next month. Oil sector stocks fell 0.4 per cent, tracking weaker crude oil prices.
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