Europe open: China property woes, oil price push stocks lower

European shares opened lower on Monday as worries about China's troubled property sector continued with developer Evergrande saying it would not be able to complete a planned restructure, while rising oil prices also weighed on sentiment.

The pan-European Stoxx 600 was down 0.27% in early deals with all major regional bourses lower. Shares in Shanghai fell 0.54%, with Evergrande stock down 20%.

The developer on Sunday said it could not meet the qualifications for the issuance of new notes as its principal subsidiary, Hengda Real Estate Group, was being investigated.

Investors will also be eying Germany's Ifo Institute survey of business conditions in Germany.

Oil gained ground again, with benchmark Brent Crude above $94 dollars a barrel, after falls last driven by fears of weaker demand. Hawkish comments from the US Federal Reserve and the Bank of England last week about persistent inflation have been amplified by the rise in fuel prices.

"The problem facing all the central banks is the rise in the oil price which if it continues unchecked could choke off any semblance of a rebound in economic activity. With Brent crude prices at 10-month highs and core inflation still uncomfortably high the price for keeping a lid on inflation could well see current interest rate levels remain higher for a lot longer," said CMC Markets analysts Michael Hewson.

In equity news, SBB rose 37% in early trade as the shares of Swedish property group announced on Sunday it would reorganise its business, securing an 8 billion crown cash boost and ending a strategic review.

SBB, under pressure to cut its debt amid soaring interest rates, said in May it might sell all or parts of its business, but talks to divest its remaining 51% stake in education subsidiary EduCo later collapsed.

Gambling operator Entain fell after warning on third quarter net online gambling revenues.

Reporting by Frank Prenesti for Sharecast.com