The pan-European Stoxx 600 slipped 0.4% in early trade, with oil and gas stocks dropping 1.2% to lead losses as most sectors and major bourses slid into the red.

Much of this week’s focus will center around the U.S. Federal Reserve’s two-day policy meeting, concluding on Wednesday, with economists broadly expecting a 75 basis point hike to interest rates by the central bank.

The European Central Bank last week kick-started its own hiking cycle with a 50 basis point increase, larger than previously suggested.

Hawkish ECB policymaker Robert Holzmann told an Austrian broadcaster on Sunday that the Governing Council will consider the economic landscape across the euro zone before determining whether another big rate hike will be feasible in September.

Shares in Asia-Pacific were mostly lower overnight as concerns about a global economic downturn put the brakes on a recent return to risk-on sentiment for investors, with traditional safe haven bonds and the dollar finding substantial bids.

U.S. stock futures were fractionally lower in early premarket trade, coming off a positive week on Wall Street as traders brace for a barrage of corporate earnings and assess the Fed’s future rate hiking trajectory.

Corporate earnings will also be a key driver of stock market movement in Europe, with UBS, Unilever, LVMH, Credit Suisse, Deutsche Bank, Daimler, Shell, Barclays, Nestle and Renault among the major players reporting throughout the week.

Notable earnings due before the bell on Monday came from Ryanair, Vodafone, Philips, Faurecia and Julius Baer.

Philips shares plunged 9% in early deals after the Dutch medical equipment company missed second-quarter core earnings expectations by a significant margin and cuts full-year and mid-term profit outlook.

At the top of the Stoxx 600, Verbund gained 3.3% after Barclays upgraded the Austrian electrical company’s shares to “overweight.”

On the data front, German retail sales and the Ifo business climate index for July are expected mid-morning.