Europe close: Stocks in the red after worse-than-forecast UK GDP

European stocks slumped as investors weighed worse-than-expected UK economic growth data and concerns over Greece and Russia.

The UK economic expansion slowed more than forecast to just 0.5% in the fourth quarter of 2014, as contractions in construction and production weighed on growth.

The quarter-on-quarter rate of gross domestic product (GDP) growth eased from 0.7% growth in the third quarter of last year, missing the estimate of 0.6%.

On a year-on-year basis, GDP growth improved to 2.7% from 2.6% but came in shy of the 2.8% forecast, according to the Office for National Statistics (ONS).

Meanwhile, Moody's Investors Service said the outcome of the elections in Greece was credit negative for the country's rating because it caused prolonged financial uncertainty as the anti-austerity party Syriza comes to head with the Troika (International Monetary Fund, European Commission and European Central Bank).

Ministers on Monday agreed to work with the new government to help keep Greece in the euro, Dutch Finance Minister Jeroen Dijsselbloem said.

Weighing on the market elsewhere, the EU is expected to add more individuals this week to a list of those facing visa bans and asset freezes in Russia as deadly clashes between government troops and rebels escalated.

US data

US new home sales advanced 11.6% in December, beating expectations for a 2.7% gain. It followed a 6.7% fall in November.

US consumer confidence increased more than forecast in January. The sentiment index jumped to 102.9 from 93.1 in December, compared to analysts' estimates for a reading of 95.5.

US durable goods unexpectedly fell 3.4% in December following a 2.1% drop a month earlier. Analysts had predicted a 0.3% rise.

Philips, Easyjet

Royal Philips NV dropped after saying it is falling short of its 2016 financial targets following shipment delays, currency impact and weakness in some of its markets.

Easyjet gained after reporting an increase in first-quarter revenue, as the airline expanded its capacity.

Siemens declined as the European engineering company reported a fall in first quarter profit.

The euro rose 1.14% to $1.1366.

Brent crude futures increased 1.3% to $48.84 per barrel, according to the ICE.