European Stocks Gain for 3rd Session

European stocks extended losses on Friday, with the Stoxx 50 falling around 0.5% to a more than four-month low and recording a weekly decline of over 2%. The broader Stoxx 600 also dropped 0.5% to a two-week low, ending the week down more than 1.5%. Germany, the UK and France led Friday’s declines, while Spain and Italy posted modest gains. Industrial goods and services, automobiles and parts, telecommunications, and consumer goods fell more than 1%, while banking, technology, travel and leisure, and media stocks also weakened. Energy stocks outperformed, gaining nearly 3% as Brent crude reached new highs amid escalating attacks on Saudi Arabia. Corporate earnings drove significant individual moves. Kering plunged more than 15% as Gucci sales declined, while Volvo Cars dropped nearly 25% following a sharp fall in Chinese sales. Safran lost 10% despite higher sales, whereas L’Oréal climbed over 5% on stronger-than-expected third-quarter results.

European stocks edged lower on Friday, with the STOXX 50 falling 0.3% and the STOXX 600 declining nearly 0.1%, as investors weighed rising oil prices amid escalating Middle East tensions against fresh corporate earnings updates. Kering tumbled almost 11% as Gucci sales dropped. Volvo Cars plunged nearly 25% following a sharp decline in sales in China. Safran lost 5.3% despite reporting a rise in sales. SAP was also down (-2.1%). In contrast, L'Oreal was up more than 3% after the company reported upbeat sales for Q3. SAAB shares rose 1.5% after the defence company reported better-than-expected earnings and revenue, supported by a deal to supply Gripen fighter jets to Ukraine. Meanwhile, flash PMI data showed a slowdown in private sector growth in both the Eurozone and Germany while French private-sector activity contracted. For the week, the EURO STOXX 50 lost around 1.9%, while the STOXX Europe 600 fell approximately 1%.

European equity markets were set to open slightly higher on Friday following a sharp decline in the previous session, as investors continued to evaluate the outlook for AI investments. Global equities came under heavy selling pressure on Thursday amid growing concerns over the sustainability of massive AI spending, prompting investors to seek the relative safety of bonds. Rising oil prices, driven by escalating tensions in the Middle East, also kept market sentiment cautious. In Europe, attention will turn to UK retail sales figures and preliminary manufacturing and services activity data from across the region. On the corporate front, Italian energy giant Eni announced plans to increase shareholder returns as the conflict in the Middle East pushed energy prices higher, while Swedish automaker Volvo reported solid third-quarter earnings, supported by improving demand in North America and Europe. In premarket trading, Euro Stoxx 50 and Stoxx 600 futures both gained around 0.1%.