(Reuters) - European shares declined on Monday on sobering expectations of an aggressive interest rate cut this month by the U.S. Federal Reserve, but the losses were limited by a 2.7% jump in Deutsche Bank after it announced job cuts and launched a major overhaul.
Shares of the German lender (DE:DBKGn) touched their highest since early May after it announced a restructuring plan that will cost 7.4 billion euros ($8.3 billion) and see it undo years of work that had aimed to make its investment bank a major force on Wall Street.
The move comes after Chief Executive Officer Christian Sewing had flagged the restructuring in May, seeking to convince shareholders that he can turn around Germany's biggest lender after shares hit a record low.
This limited the slide in broader Europe, with the pan-European STOXX 600 index (STOXX) down 0.07% by 0707 GMT, as they followed Asian shares into the red.
Defensive stocks and financials weighed on the benchmark as it extended last session's decline after strong U.S. jobs data saw investors trimming bets of a 50 basis point interest rate cut by the Federal Reserve in July.
Much of the global stocks rally since June has been spurred by expectations of an accommodative monetary policy by major central banks to tackle slowing growth as the damaging trade war between United States and China takes its toll.
(The story corrects milestone on Deutsche Bank shares in paragraph two to highest since 'early May', not 'late April'.)