European stocks retreat from 2-month peak after mixed German Ifo survey

European stocks edged lower Monday after mixed Ifo survey on German business conditions, easing from the two-month high they hit after China cut interest rates and the European Central Bank signaled more stimulus. Meeting of both the Federal Reserve and Bank of Japan are expected this week.

The Stoxx Europe 600 fell 0.3% to 376.23, with all sectors trading in the red territory. The Stoxx 600 on Friday jumped 2% and logged its highest close since Aug. 19, rallying after the People’s Bank of China cut interest rates and eased reserve requirements for banks the same day. That move came a day after European Central Bank President Mario Draghi opened the door Thursday to further stimulus to help drive euro area inflation higher.

In Frankfurt, Germany’s DAX 30 added 0.17%.

In Paris, the CAC 40 dipped 0.45%, and in London, the FTSE 100 lost 0.27%.

The euro was last at $1.1031, up 0.11% for the day, compared with $1.099 late Friday.

Business conditions in Germany have dropped in October, according to the latest survey of corporate confidence in Europe’s latest economy.

The Ifo thinktank has just reported that current conditions in the German economy have deteriorated this month, for the first time in four months. However, Ifo also found that business leaders are more positive about future prospects than in September. That suggests the VW emissions scandal has not caused major trauma.

IFO’s business climate index fell to 108.2 in October, down from 108.5 in September but higher than expected.

The current conditions index fell to 112.6, from 114 a month ago. That suggests that business leaders are finding life a bit harder -- after seeing exports and factory orders deteriorate over the summer.

But the expectations index rose to 103.8, from 103.3, indicating that Germany PLC expects to ride out the slowdown in China and other emerging markets, and the Volkswagen saga.