By Peter Nurse 

Investing.com – European stock markets traded higher Monday, ending a difficult month on a positive note while investors keep a wary eye on political developments between Russia and Ukraine.

By 4 AM ET (0900 GMT), the in Germany traded 1.6% higher, the in France climbed 1.1% and the U.K.’s rose 0.4%.

Global stock markets have been hit hard in January, with the DAX, for example,  down over 3.5% as investors worried about rate hikes from the Federal Reserve to combat soaring inflation. 

There was a more positive tone Monday, helped by an easing of manufacturing bottlenecks for German companies in January, according to the Ifo economic institute.

The number of German manufacturers reporting problems procuring intermediate products and raw materials eased to 67.3% in January from 81.9% in December, Ifo said. 

While this release suggests problems still exist, any reduction will be welcomed as these disruptions translated into a contraction of 0.7% in the fourth quarter in Germany, Europe’s largest economy.

Still, any gains are likely to be limited as investors focus on a meeting of the UN Security Council to discuss Russia’s troop build-up on the border with Ukraine. 

Western countries are currently preparing sanctions to levy on Russia should it invade its former Soviet-bloc neighbor, something Britain called “highly likely” over the weekend. Such a move could have severe repercussions for Europe’s energy supplies if Russia decides to limit its output to the region. 

This turmoil has helped oil prices climb to near seven-year peaks, ahead of Wednesday’s meeting of the Organization of the Petroleum Exporting Countries and allies led by Russia, a group known as OPEC+, to discuss future output.

U.S. traded 1.1% higher at $87.75 a barrel, while the contract rose 1% to $89.40. The benchmarks recorded their highest levels since October 2014 on Friday, and their sixth straight weekly gain. 

Staying in the oil sector, energy giant Shell (LON:) said it would begin trading with a single line of shares on Monday, ditching its A and B shares as part of plans to simplify its dual share structure.

Elsewhere, Vodafone (LON:) stock rose 3.2% after news emerged over the weekend that activist investor Cevian had built up holdings in the telecoms giant, looking to improve its global business. 

KPN (AS:) stock rose 1.5% after the Dutch telecom company reported a rise in core profit of 4% in the fourth quarter, as revenues from mobile services to consumers and companies grew.

Spanish inflation slowed to 6% year-on-year in January from 6.5% in December, mainly thanks to lower electricity costs, but the major economic data release will be the preliminary fourth-quarter for the Eurozone, which is expected to rise 0.3% on the quarter, a gain of 4.7% on the year. More importantly for the Eurozone, data later are also likely to show a fall in the annual rate of inflation, as the previous year’s increase in VAT passes out of the calculations.

Additionally, rose 0.3% to $1,789.90/oz, while traded 0.3% higher at 1.1171.