European shares tracked global equities higher on Monday, but investors were seen staying cautious ahead of a European Central Bank policy meeting and a scheduled resumption of Russian gas flows via the Nord Stream 1 pipeline.

The pan-European STOXX 600 index rose 0.9% by 0716 GMT after posting a 0.8% drop last week. Gains on Monday were broad-based, with miners, energy stocks and banks leading the rise.

Sentiment globally was lifted by China stimulus hopes amid COVID-19 flare-ups, and easing fears about a 100-basis-point rate hike by the U.S. Federal Reserve this month.

The ECB on Thursday is set to hike its key interest rate by 25 basis points, and investors will watch out for clues on the pace and magnitude of future hikes as well as the bank's tool to cap widening spreads between core and peripheral bonds.

Meanwhile, maintenance on the Nord Stream 1 pipeline, which brings Russian gas to Germany, is scheduled to end on July 21.

Investors are waiting to see if Russia stalls the resumption of gas supply amid its war with Ukraine. This could result in a gas supply crunch in Europe and keep prices elevated for longer.

Deal-making lifted shares of Dutch engineering company Arcadis 8%, while British insurer Direct Line slipped 11.6% on bleak forecast.

(Reporting by Susan Mathew in Bengaluru; Editing by Subhranshu Sahu)