Europe seen higher after China stimulus, Greece in spotlight

European markets are expected to open higher Monday after China's central bank over the weekend cut the amount of money that banks must hold as reserves, but developments in Greece will likely keep the mood cautious.

China's equity markets experienced swings early Monday after the country's central bank on Sunday lowered the reserve requirement ratio (RRR) for all banks by 100 basis points. The wider-than-expected cut was the People's Bank of China's (PBoC) second reduction in two months as the world's second-largest economy combats slowing growth.

Greece remains in focus for European markets. European Central Bank president Mario Draghi said on Saturday that the country, which is running out of money and could default on its debts – and potentially leave the euro zone – had to try to save itself. Speaking at the International Monetary Fund's spring meeting in Washington, Draghi told reporters that the fate of Greece remains "in the hands of the Greek government."

Meanwhile, Greek Finance Minister Yanis Varoufakis said in broadcast interview Sunday that if Greece were to leave the euro zone, there would be an inevitable contagion effect.

"Anyone who toys with the idea of cutting off bits of the euro zone hoping the rest will survive is playing with fire," he told La Sexta, a Spanish TV channel, in an interview recorded 10 days ago, Reuters reported.

The euro group of finance ministers is due to meet on April 24 to discuss Greek reforms in return for aid but some officials, like German Finance Minister Wolfgang Schaeuble, are skeptical the meeting can yield a solution.

On the corporate front, Volkswagen Chairman Ferdinand Piech's position in the German carmaker's management has been severely weakened following a dramatic confrontation with senior board members last week that nearly resulted in a push to oust him, sources told Reuters Sunday.