European shares open lower as energy stocks, higher yields weigh

(Reuters) – European shares opened lower on Monday, extending their lacklustre start to the year, as higher government bond yields and tepid energy stocks weighed on risk appetite.

The pan-European was 0.1% down by 0815 GMT.

The yields on the European 10-year benchmark note and the German 10-year tracked their U.S. peers higher and were up for a third consecutive session.

Fading expectations of an early U.S. rate cut kept the dollar and bond yields supported, ahead of consumer price inflation report on Thursday.

European oil and gas stocks dropped 1.4% to weigh the most on the STOXX 600 index, as crude prices dipped following sharp price cuts by top exporter Saudi Arabia and a rise in OPEC output. [O/R]

On the data front, German industrial orders rose less than expected, while exports rose more than forecast in November.

Investor focus will also shift to euro zone retail sales data for November due at 1000 GMT.

In corporate news, shares of Pandora (OTC:) added 2.5% as the Danish jewellery maker exceeded quarterly sales expectations.