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JDE Peet's tops STOXX 600

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Puma jumps on report Pinault family weighing stake options

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Orsted at a record low after US halts wind project

(Updates after markets close)

By Sruthi Shankar and Sukriti Gupta

Aug 25 (Reuters) - European shares closed lower on

Monday, giving back Friday's gains on optimism around U.S.

monetary policy easing, while JDE Peet's soared on a buyout

deal.

European markets came under pressure following Friday's

surge when U.S. Federal Reserve Chair Jerome Powell pointed to a

possible interest rate cut next month, citing rising risks to

the job market.

The pan-European STOXX 600 index closed 0.4% lower

in its worst day in over three weeks but was about 1% away from

record highs.

Germany's DAX dropped 0.4% and France's CAC 40

slid 1.6%. The UK market was closed for a public

holiday.

"Powell didn't really change the narrative as much as the

U.S. market portrayed, but Europe was definitely part of the

global party on Friday," said Steve Sosnick, chief market

analyst at Interactive Brokers, adding that investors were

booking some profits on Monday.

Construction and materials stocks were the heaviest

drags on the index, with Nibe Industrier down 7.9%.

Utilities logged their steepest decline in more than

a month. Orsted plunged 16.4% to a record low after

the U.S. halted the Danish company's Revolution Wind project off

Rhode Island amid President Donald Trump's pushback on renewable

energy investments.

Peers such as Vestas Wind ( VWSYF ), EDP Renovaveis

and Siemens Energy also lost ground.

JDE Peet's touched a near three-year peak and was

last up 17.5%, after Keurig Dr Pepper ( KDP ) agreed a deal to

buy the company for 15.7 billion euros ($18.4 billion) in cash.

Five sources told Reuters that the European Central Bank is

likely to keep interest rates steady next month, but discussions

about further cuts may resume in the autumn if the economy

weakens.

The ECB left its key rate at 2%, bringing a year-long easing

cycle to an end and leading investors to bet on a prolonged

pause.

Sosnick said a pause was not necessarily a "bad thing" if an

economy was holding up, since the ECB had aggressively cut rates

over the last several months.

Puma SE surged 15.9% after Bloomberg reported that

the holding company of France's Pinault family was weighing

options for its 29% stake in the German sportswear maker,

including sounding out potential buyers.

Argenx rose 4.3% after RBC started coverage with

"outperform" on strong belief in its Vyvgart medicine.

Valneva slumped 22.2% after the U.S. drug regulator

suspended the French drugmaker's licence for chikungunya vaccine

Ixchiq with immediate effect.

This week, focus will be on U.S. AI darling Nvidia's ( NVDA )

quarterly report for signs its $4 trillion valuation is

justified.

On the tariff front, Switzerland hoped to finalise a new

business offer for Washington soon to escape Trump's 39%

tariffs.

($1 = 0.8545 euros)